ML20053C613
| ML20053C613 | |
| Person / Time | |
|---|---|
| Site: | Nine Mile Point  |
| Issue date: | 03/01/1982 |
| From: | NEW YORK STATE ELECTRIC & GAS CORP. |
| To: | |
| Shared Package | |
| ML17053D168 | List: |
| References | |
| NUDOCS 8206020381 | |
| Download: ML20053C613 (39) | |
Text
g!
( , ,
'5h '
. nw .
- f.;.;-l
')<*
- D'
. ~ Off, gu,
- [ ;>1
- y
- i
' gg; '
m-
,&@ way4 ,
,a -
. + ,
.j[ , ,,m .
k., . .
1
_ ~ _ - -
ANNUAL REPORT 1981 r
- .. e r- .- , , , ;
y; "
Contents , e - - E -
Highlights of ;he Year 1 . .
'7
( m
%~f cq. .
Letter to Stockholders 2 Nc g . rj.: ~ .. ~.
Condensed Statement of Income 4 -
, ; ~ .1 ~
General Review of the Year Earn.ngs and Dividends 5
5 n*"
k . .;
k Dividend Reinvestment Plan 5 Ym t - * ---
Li .. [(@ #' ' ~
Rate Matters 7 TM - ~ '-
- i. . '2 , #
'A' (-
Power Supply 7
~.,. - -
Future Power Supply 9 j j yf . g .
Terminated Nuclear Projects 11 y gg 4 ., , . ,
1981 Construction 11 i . . - V s) s. . -
Future Construction Financing 11 11 c ,- ,
} ,,,.;; *. *g]
y.y Research and Development 13 a
~g'Ib~~ti[.h- '
~ '
7S- ? .;
Customer Assistance 13
- -- 'i - ^- - --
Personnel 15 Cover:
Electric Operattons u5 with the rising cost of new power plant , improvement nd maintenance Gas Operations 15 of existing facilities becomes in-Balance Sheet 18 creasingly important. Shown here is new control equipment at Goudey Statement of Income 19 Stanon near Binghamton, a plant Statement of Retained Earnings 19 which produces 129,000 kilowatts Statement of Changes in F.inancial Position 20 from electricity generating units Notes to Financia\ Statements 21 installed over 30 years ago.
Manag . ment's Discussion and Analysis of Financial Condition and Results of Operations 29 Financial and Operating Statistics 31 Directors and Officers 36 Service Area Map 37 i
Highlights of the Year 1981 1980 increase Percent I
Gross operating revenues (thousands) . . . .. $ 767,539 $ 645,314 $122,225 19 income before interest charges (thousands) . . . . $ 175.764 $ 145,886 $ 29.878 20 l Earnings available for common stock (thousands) $ 90,265 $ 73,637 $ 16,628 23 Earnings per share of common stock .. .. . $2.95 $2.70 $.25 9 Allowance for funds used during construction per share of common stock . . $1.07 $1.13 $(.06) (5)
Dividends paid per share of common stock . $1.94 $1.82 $.12 7 Taxes per share of common stock . . $3.51 $2.98 $.53 18 l
Electricity sales to ultimate customers (million kwh) 11,00d 10,742 266 2 Gas sales (thousand dek9. therms) . . 39,956 37,658 2,298 6 Cost of fuel for electric generation (thousands) $ 177,592 $ 151,404 $ 26,188 17 Total utility plant (thousands) . . . . $2,391,712 $2,117,241 $274,471 13-Expenditures for construction (thousands) .. . $ 265,545 $ 154,516 $111,029 72 Book value per share of common stock (average) $22.01 $21.92 $.09 -
l Market value per share of common stock (year end) $15.00 $14.88 $.12 1 1
THE ANNUAL MEETING of stockholders will be held at the Corporation's General Office Building on Route 13 (Dryden Road) in the Town of Dryden, N.Y. on May 14,1982 at 11 a m. Formal notice of the meeting. a proxy state-ment and form of proxy will be sent to stockholders in early April.
1
To the Owners of NYSEG:
I: ) q ) ,
) b j{__ , ' '
Q (' , y ) \
r ;, A r
- e ,rr J t ,r H/ ;t " e r .>o n' re n,e W <f u > n u (t resu<:e wqft 3d
[J /! I (a *i,t't> '
- ,r ;e ' * .J' I f u s fj d fTh 3 r ef f d p' A
'h i'1981,Pld?>1e Efe J () 9 W 'e e m
. , 1 n,- ;t . 4 -o, ra'r me ar ; n j side (n,a:e ra:e penchres for nyon tw ,'
' e , :jr <; At'(.' (2 4 e ! J1 r+ it ?' ie ' A f ; ()rF), N )(, , T< }*e (; a 30s ()l ner st d be'ler ]!;rl() b's!!II')r llr id c
+
1, r s < p < ; * /s + . Lty. 1 ;' t ly?)< cia '980 n Ah.c) ae s o*her cons rt t ' on P si es J r, i' : ) i r en .e sip j r a t y )u ' 4 0 r >f " 4 - ,lel e%dr, for us 'o seek sciothor
,!. t u o ir.r ; " ,
e
' e i ' ' ,
' j [ i[ )' J ,6 f' } 1 ,jrt.');,'
, 1][j[] id 2;j f()f f lse f' r(l'tf s L lb' 'Il()! 'Il he f 6 e(j ibr 3 $ 1 dg.ry>1 itjr (yf 1 () >
,r) e r, ,g,,. r ,>#. r.j't>' < r i t ( j r ' , r i j f t. 2 , ( (ji l'ir ),,f 3(j t it < g -
.e:! t ',si; > ' ,Li r l'e-
- t;r -im j 'he attenttin' h.qh ( osis Crease in eet +nc ra'es and a
? <
g t< j j, " ] r>>,sa e
' i/ i 3r t(js *(j tir L]n( (* (f jr f 71d gir 54 9 't,t :i(r i (>' :' 4 t"c rease ir 4 gas rates The proposec t ra'es are :)ased on a 1/ 5 ' re! rn on conifTlr en S!OCL Huu% clnd L)rc, jeC'e() ()DerdilOrlh it)r d ( Il efldd' 1983 fes' yed' IfM2 sliso 'n y wen /5 P 4//en. Jr (reff/ C je lp) ,f redM. rit'Or ] git ,C*1or) and Ch.utes F Kennedy WOf L ;n progress it) ra!O Udse
. .7 - , . ~ j. - ,- 3 3 -s .- - - - ~- , to $450 om ,on from $200 nmon
,n.-
presonry ret ected in ra'es f,,\..fL".?
' - - ^ .
- f .~.
..,% . , . 4 , . .
JI I .- (jf } }{f f hf } , h [j [ )() ' ()[I)h(
625 000 ki osa" coa taed
~
q, .- U. , ,
'F #
g f- k -, ,,.
[i* -
s
., ?. generannq staSun whth ! ,
e .- * , ,
pl3[]Tlp(j f(3r ifl:!ld. ggrq l( ,4 3 r) { { '(1 e '
,F ,. , h '
'u c- . . -:(
.,~
19sa es cons *rumon has
~
- ....J,.>..
p'
.. .. e
- . j . )
c- *p-
/ .: .
..,=.
, , 7 7), y
- [is _' u s .
, . 4 .A - . -
1
- 1 . x .%.- y -
4 -- - and v. hen como:e'ed aM 1.t A
F-
- n, ;' a,.
a *~ - ~.
..'- 5 - eJ.- _ vk = reduce Cos! y e ectr <cas ourchases 1... .. .g. . : . . . ..
- ( ' . : 7I
- ~
Q$. s . , ' 3 - , ..
-" :. , [ - . - ~ j, p+ 2[# ':.y and contnuute to a reduction e..
.g..N;
.q (i ,,g.
1 . , .
in 'he <;se of no fur e ec'rE
.. f ,, ;.1 b
. + .n ']e
~
s .o . , ,
~, , " {j : $, # y t, , , .
r generaSon .n the state The on'y
- A...
- -. -(: ;,.'Y \ ^- , ,
.7, . g, EJ
< . 1 -
.p son'tican' 1moed. ment *o
' 1 e ; l
', -,....,., date has Oeen 'h+; tamre '() ot/Jn
' .' - p . d' f(fl pyrlj re(Ji j ({,,0f g (j[)[)f( ) j i}
. i
' .t
,^ .
~
, .j 1 ,
y to, a , ,m mm. , n, e,,en
- -e Q , w; {.
- 'o transov wa and o'her
.t. . .
4
, -J.,7.-
e-g pw, y raw ma: era s ? > me o .c >' ne, tse q
(jf (}'f f(}r(2rl:~~ ( 's I r l [i(,[J ( ( )[);'ll' )r' f~ . - ' ' - -
, . 4,3 j as * )<1rc ,'e t g " q . ', i r *
,W+>
y ^**a .
y f. - , _. 9- og a
.. a, -
" ll (? Y~
f ,
. N .o
~
m c ~ ~ < < - ~ -
y...,.n.y.;7y : -
, g i- S 4 .
' .".. ^* .- . . .
"- - . . . : . . . . ... , G ; ..
3 6.
Another important regulatory Last October's favorable rate customers it will mean moderating decision pending is the Public decision should permit some ir; creases in electric and gas Service Commishs study of the closing of the gap, experienced rates. The extent of moderation will economic and financial impli- in recent years, between allowed depend on the rate of inflation, cations of continuing construction return on common stock equity in last year's Annual Report we '
of Nine Mile Point 11 nuclear and the return actuallj earned. included a readership survey generating station. The Company While we do not anticipate earning card which many stockholders is one of five utility owners in 1982 the full 17% return completed and returned to us. We and holds en 18% interest in the granted by the PSC last October, appreciate the response as plant which is about one-third we do expect to come closer your replies and comments help in built. It is being constructed to earning the allowed return than planning this report and other by Niagara Mdawk and is in previous years. stockholder communications.
scheduled for operation in late Rate decisions in the past year We look forward to the future 1986. The PSC has substantially and other developments indicate with confidence. NYSEG has a completed its deliberations, that the regulatory climate in New fine service area, a competent indicating that completion of the York is improving. We were en- management team, and an plant is warranted. A decision couraged recently to read a PSC employee group that is second to has not yet been formally issued. administrative law judge's rec- none in the utility industry.
It is possible that the decision ommended decision in a thorough, Employee dedication is amply will include incentive provisions two-year-long proceeding ex- demonstrated during storms and that benefit or penalize the ploring utility financial needs. His other emergencies when long, project's owners if certain costs principal finding is that including tedious hours are devoted vary from prescribed target levels. construction work in rate base to restoring service. In addition to The estimated cost of Nine Mile is the most effective and lowest- their work responsibilities, many '
Point il has risen sharply since cost method to enable utilities to employees spend off-hours in 1974 when the project started. maintain financial integrity. community activities We take this Like other nuclear plants presently We heartily agree and hope this opportunity to acknowledge under construction, costs have proceeding, which is expected empInyee contributions and thank been affected by inflation, high to be completed in 1982, will re- them for a job well done.
interest rates, and revisions in sult in further improvement For the Board of Directors, regulatory requirements, some of of regulatbn in New York.
which stem from the Three Mile Island accident. Since capital To use a phrase heard quite regularly these days in the electric -
SOg costs of other sources of electricity utility industry, we are beginning Chairman and Chief ;
have also increased materially, to see light at the end of the Executive Officer -l the relative economic advantage tunnel. Barring adverse develop- I of Nine Mile Point 11 semains largely unchanged. Moreover, the menta we expect to be able to finance construction expendi-
[
President and Chief l
addition of nuclear capacity will tures for Somerset, which peak Operating Officer reduce the state's dependence on in 1982 and 1983, then return to imported oil. something resembling normalcy March 1,1982 in the mid-1980s. For our stock-holders it will mean fewer issues of new common stock which tend to dilute earnings. For our 3
Condensed Statement cf income I
1981 1960 increase (Thousands of Dollars)
REVENUES Sales of eiectricity $609.178 $506,502 $102,676 Sales of gas 158,361 138,812 19.549 Total 767,539 645,314 122,225 EXPENSES Wages and salaries of employees and contnbutions to retirement and insurance plans (exclusive of
$44,504.000 in 1981 and $43,046,000 in 1980 charged to construction, etc.) 83,044 73,442 9,602 Fuel used to produce electricity 177,592 151,404 26,188 Electricity purchased and interchanged 7,029 (2,030) 9.059 Gas purchased .
112,176 100,895 11,281 Other materials, services and research 77,100 67,822 9.278 39.044 21,600 17,444 Federal taxes 68.264 59,838 8,426 State and loc 1 taxes Depreciation 49,448 47,486 1,962 Total 613,697 520,457 93,240 Income available to investors 153,842 124,857 28,985 ALLOWANCE FOR FUNDS USED DURING CONSTRUCTION 32,719 30 925 1,794 INVESTORS' SHARE Interest on bonds 67,389 59,967 7,422 Interest on notes payable and other 11,371 7,611 3,760 Dividends on preferred stock 17,536 14,567 2,969 Dividends on common stock 58,657 49,091 9,566 Total 154,953 131,236 23,717
$ 31,608 $ 24,546 $ 7,062 RETAINED IN .THE BUSINESS 4
Gen:ral Review l cf tha Year I l
l Earnings and Dividends greater number of shares outstanding, certain U.S. Treasury requirements Oper: ting income Rises 26% increased total common stock regarding retention of shares.
dividends $10 milhon, or 19% Under present law, the tax benefit Operating income was $145 milhon. After dividends, the balance of net terminates at the end of 1985.
an increase of $30 million, or 26%
income of $32 million was added During 1981, participation in over 1980 Revenues increased $122 to common stock equity. the Dividend Reinvestment and Stock milhore, which incluaea $57 million For federal income tax purposes, it Purchase Plan increased from from higher electric and gas rates and is estimated that no portion of 12.000 to 14,000 stockholders. These
$48 milhon from increased fuel 1981 dividends was a retum of capital; stockholders, representing about and purchased-gas costs included in therefore the dividend is fully 20% of the total number of stock-bilhngs Optrating expenses. ex- taxable as ordinary income, Similarly, holders, purchased over $13 million cluding energy product;on costs. the Company anticipates that no in new shares by reinvesting were up 13% largely as a result of portion of 1982 dividends will be dividends or making optional cash inflationary nses in labor and considered a return of capital. purchases. This compares with matenals expense $8 million in 1980.
Interest charges, including interest in January 1982 stockholder par-on short-term debt, rose $11 mil- Dividend Reinvestment Fian ticipation in the plan increased from lion, or 17% Higher interest rates and New Tax Break For 20 to 25% probably because of increased borrowing required to Stockholders the new tax law benefits.
finance construction v.ere largely re- The plan allows shareholders to re-sponsible for the increase The Economic Recovery Tax Act of invest quarterly dividends and Allowance for funds used dunng 1981 provides a tax benefit for ehgible make monthly cash payments of up construction was 36% of earnings stockholders reinvesting dividends to $5,000 quarterly for purchase available for the common stock. This in quahfying utility companies such of shares. Dividends reinvested pur-is a decline of six percentage as NYSEG Beginning in 1982, stockholders can exclude up to $750 chase shares at 95% of the average points from i980 and reflects rate in_ market price on the dividend creases which allowed construction ($1,500 on a joint return) of re-payment date. There are no service work in progress in rate base invested dividends from their taxable income. If the shares purchased chargcs or brokerage commissions.
Allowance for funds used dunng if you are interested in enrolling construction represents financing are sold after one year, the proceeds in the plan or desire further informa-cost such as bond interest, that is will be taxable at capital gains tion, please write:
allocated to major projects under rates which are lower than tax rates NYSEG Shareholder Services, construction. It does not constitute on )rdinary income. There are P. O. Box 200, Ithaca, New York cash earnings- 14850.
Earnings ava lable for the common stock of $90 milhon increased 23%
over 1980 On a per-share basis, earnings of $2.95 were up only Total Operating Revenue t=1 ELECTRIC 9% because of a 12% increase in Millions of Dollars GAS and Other average number of shares out- '
~
1972 T 236 standing. +
p -
The quarterly dividend rate on 1973 g s ]d i 253 the common stock was raised from 47 to 50 cents effective with the 1974 Z
~~ "
TJ f" M j 296 August 15,1981 payment. This is the 1975 m 1 4;i d i j 341 _ _
fourth consecutive year the divi-dend nte has been increased The 1976 fi d 335G] 408 higher dividend, together with a -
1977 M^ "
"NIIT"N 45.9yg
%.7@#;QZQQ 1979_.
lNf M%N8M6Mh,d5(8 wegtgegge 645 198 1981 M edmate$5L
-. _ M,, ,s ,,s, ,; _ & a_ _ m_- u u m_ m __ -- - -. - _a 768 5
- "5_l. ." ~ !_
EH -
af3@
c w
k* I y
, w i
g; I
s a y_.
,' s n,
f
. y yh
, i e
o
. A wfIw* +ski;.g OM :,
k:Nu l e 11 ERG" =cyj ,
M li V T l , _ , . _ .
semi y=-- m_ _.
- $r%
- s 3,
k'dy 1
..-- _:.- ,y o'
}g,. g..;P.. '
.f r
.,, J '
)
)
l _: ., =.==-
~
w
, 4;w . s
.: : ~ -
1 e n- '
.;,.. 7 . .
A.v.. ,p. ; . -: .-
d Y. p
. t Y. h t , ,
- . 2 ih\ W$?! '
ll l] Q QgaW l
^ '
l r
.l: w y 3 y* N.r, w:.ai ,r.
3 e ;%,bs.,,,e.~i...
.. -~ -
e ~
1
Rate Matters milhon rate request had included kilowatt-nours, an increase of
$133-Million Rate about $15 million for the annual 1% over 1980. Abou' 88% of this was incr=e Approved recovery over five years of these ex- generated by Company plants.
penditures. The remainder was Icrgely purchased in October 1981 the Pubhc Service While the rate decision was a under contracts with the New York Commission approved a $124-milhon, satisfactory one, the Company must State Power Authorit', and neighboring or 22%, increase in eleuric rates look beyond October 1982. The utiht'es.
and a $9.milhon, or 5%, increase in effects of past and expected future A new peak load of 2,193,000 gas rates. The $133 milhon in inflation, including nigh interest kilcwatts (kw) was set dunng very higher revenues was 87% of the costs, will continue to affect opera- cold weather in mic-January 1982.
amount requested and included $45 tions. For this reason it was necessary The new peak exceeds the previous mill.on in temporary electric rates for th9 Company to seek another one, which was set a year earlier, a!Iowed on June 1. In the two previous increase in rates. In February 1982 an by about 1%.
general rate proceedings, the PSC apphcation was filed with the PSC The Ccmpany's oower supply had approved only about 40% of the for a $149-million, or 19%, increase in capabihty to serve peak loads is amounts reauested electric rates and a $4 9-million. currently 2,775,000 kw. This com-1o improve cash flow and interest or 2%, increase in gas rates. The prises 1,769,000 nw of Company coverage, the PSC allowed por- electnc rate request is based on a generating capar.ity, 7C4.000 kw of tions of construction work in progress 17.5% return on common stock purchases from me Power Authonty to be added to rate base. The equity, $450 million of construction and 242,000 kw of firm purchases temporary rates were based entirely work in rate base and a calendar from neighboring utthties.
on the addition of $275 million of 1983 test year. It also includes A large part of the purchases from construction work to rate base. The revenues for recovery over ten years the Power Authority are from hydro permanent rate increase, which of expenditures on the abandoned projects on tha Niagara and St.
went into effect on October 25, is New Haven and Jamesport nuclear Lawrence Rivers. The chairman of the based on $200 milhon of construction projects. Authority has proposed a realloca-work in rate base These additions tion of this :ow-cost power through-to rate base substitute cash earnings Power Supply out the stato in 1985 and 1990, for the non-cash allowance for Generation Primarily when present contracts expire. The funds used dunng construction. Fur- Companyt; residential customers thermore, they lower the in-service Coal-Fired would continue to benefit from the cost of major projects since the All of NYSEG's steam-electnc power, but to a lesser extent than financing costs dunng construction generating stations use coal as a currently. No legislative action has are not added to the cost of projects pnmary fuel. These plants provide been taken to date on the proposa!.
but are paid for currently by 98% of the Company's genera- Despite a three-month strike of coal customers tion with hydro-electric facihties pro- miners beginning in March 1981, ,
The October rate decision was ducing the remainder. the Campany was able to maintain j predicated on an allowed 17% return Total power supply in 1981, on normal electricity production at all its j on common stock equity, based a kilowatt-hour basis, was 12.3 biliion plants except Homer Ci,y. Main- ,
on a test year ending October 31. terance work schedu;ed for this 1982 It did not allow revenues fecihty late in 1981 was advanced )
to recover pre construction expendi- ro that there was no substantial tures on the abandoned New :oss of planned power production for Haven nuclear project because a the year.
separate proceeding on that matter is pending The Company's $153-Electric Peak Loads 1973-1982 (winter Capabihty Period)
Megawatts atters s an po ant face YSEG 19 5 1724 activities. Top: Youngsters visit an 3974 3793 B tor rgh Aspa I n nergys nar, 1975_
1768 a group of teachers tours an electricity 1976 1993 generating plant. Bottom left: Displays at fairs and exhibiaans help provide 1977 2070 l the public with information about wise 1978 2034 l energy use and conservation. 3979 g33g 1980 . =' -
2072
~ ' '
. L 2170 1981 . , . .
~
1982
.- 8 ..
- _. t
_L- + '2193 7
l, 1 .
.(.-
4 y 5
- , , L .
. i
- 5 .
s
.'.'9 . .' . , .x.. w
[ ll l (. p.. _
D.- .
a-
-m m e t. .
t
(
. . -; i ? _.
c 7 n A ' ",
't 'b '
? . . w ,
' a p
. f.
l .{ t
.; '1 l
.. :,. 4 -;
g; i3 5.- _
1 r
. ,i . .. s . -
" p f.q .. .
- c. ..
. = ' *, * ' . - - 'y
=
[ } . .} ^ f "
- G. } __
} (- :
- [.[,'.);3 ' w} --
/. . , : ' j T. ' t ' p - @ g. / , ;_. _ f. j - (L. % .W
.g'f. ,,. .,.; p. .[ . . ..
[ , ~-
v .. .
\
I i .,*.;( .- , zw *
- l
,6~ c
' ,n:. -
.-' 4
'..( .
- .. . ~ . : .- .g-9 .'s a '
. [ , ' y'
,)
.;. % .l M ..
s . .,. ' ~ ,'_ -- _
= m_- , 9
- 3. 9 , : p .- .
- 1. , . ... . .. , - a . .- .- e. ,,
E -- ,
'e .
- I . , .iOi jg ,
.. .A
~ L. -
.,;( . .-
,.7 - .-- . . , .
9
, j . ' -
'%. n e p.ar
..n ;* - ),
^ ~ '
~
- - I -
1
- .~ ' . _ '*ng , , . . ,-
g,_ -,_,.et.
, v ,, ' ,,
-,..:g._-
. .s ; .-
- p. . -
Y ..
> ~ .-e _
,' . " *. ' ' ' . ' . ' *$ 7, S .
- N ., j- g Y: ? : -
s-
. g .. . . 3 ..
,; e f3:. b. 4-.
- y. : _
i
- ,' [
- . ; fg
[ y y ~, .
,4. '. ,; - * '~
- j. ; p o ' *- ...s...-
,, n -
.. l
- ' A se t
.. ,,; - . .&. . ..gy, r .
Q ..f 4%. .,.) D, ,. 4 , .
,0 . *. -, .
i_-j"I-)gW'* [ A,,,: ._ ;f* _ .Y , ,,; k- '
ll I N.?!' . "4. b.
. . = .
-l. - . .: .c .
g pg.a _. -/ y +.. y._ . , ;
ur
~t ; :.
. .e ,.,,
e .,:_ , , . _' ~.
=
_ f;y g. .f ,f* .- .. . .
.e . *
._..x
, . ,..a . .,
',v w: -.c - ~ .f ,' ( ; .; .'. ; - k 'p
.:. g .. per -
- . - . 1}
r - - ::,- ut zt . - -- * .
t 19 ' ;
' - - ' "s * *
[; ._ * ,
- e. _.,, ,
- N yI,f ,,
k? .. .. . .
l [ _ l -, .
~
_ _ _w m a.
\
. ~ , - . .
.._,, j .; , ,,
s ;-..
,_ m . :. , -* -
. 3 s .
e r .
-y. . - _
. .' p, $ ' .
~
W. y ' } ^*L' -
. p. .. 7 .
?i
^
j ,.
n.-
~
l 1
. '. j g' . '.
_ -l ,, *.[ _, z :; , f '
.f .. -
,,. .. . ,. ,, 4
,_ i i.
s v . . ~ , a- . . . .
.x. ..' Th
~
' , l'+~ , , , . ' ,_
j .. ' , ' h*
u .
- + ;. ,_ . .. _
l y, 8 . ' 0' '
.',.,...*,..es, .,
a : ,. .
. ., . , , , . , . .s.
c _ . . , ..} . , . . . ' ., .
.y, ,,.-.
j
^
,. - [5 . .- # 34
~
- ,0'
- e - . ,
- -'I'.-
--,,,y [./.. ..'. -. J' ,: ,,, .
. . . , : 1 *.
)
6 _ _ . . _ . . _ . _ _ _ _ _ _ _ . .
l l
l
,.. 2
%tect framing Is crocted for Somerset . .
Generating Station, a coal-fired -*
- I s facility bcong built by the Company In westem New York It will add -
~
625.000 kilowatts to electnc generating g - -
f capacity when compicted on 1984. .
- W..
r .; s. 9. .
^
l ' ..8 ,' ' + : 7 _ .> q .
/
jg .~ wW p- mg g.
lik
- a. a r.,g .n.-
c 4
%w;
- gg .1 gi1- ;;
4, ,
I s --
6 .- yj L e q. Wp W. # -
-4 - .
Future Power Supply I( ' f: . -
/
n,' '
Q
[ en g Somerset Project Progresses
{ ,
(. .
j
(
~
Good progress was made in 1931 on f E- ', , / [
- l. 'j '
g,, . ]y the construction of Somerset. a [ , l*, !
whohy owned. 625 000-kw. coa l-fired <
' < gV %
( g ',, 4 ' . F s
'yy
- .k generating station being budt near .
h;g g g .3 [. h 'e.W' e ':
Lake On'ano in v.estern New g York Steel structure for the ma:n J e ty,e . . , ,,., ,g budding has been erected and work y g. f - _.
" " ' ~
,y q has begun on facdities to bnng - ,
lake cochng water to tne plant En- ,
i 3MN' ,'
~ ' '
3 D, . ' N g:neennq work wdl be substantiahy e .
L
-~3 ~
completed b/ the end of 1982 -
About 70% of the work, on a ao!!ar ~ ' , 'M' e [ c .. h bas 7 has been contracted for g M. .
.=mumsg, g 4-with rema:n nq major contracts ce pected to be awarded by September
'~*-"' *
1982 The project is scheda'ed for complet;on in late 1984 struct:on of a 1.084.000-kw nuclear 1974. Ac a result, the PSC. in late The plant is estimated to cost generating station near Oswego. N Y . 1981, initiated a proceeding to review
$1.072 nton. which mcludes kno.vn as N,ne Mde Point 11. NYSEG the financial and cost imphcations aHowanco for funds used dunng con- owns 18% of the unit, which is of comp!eting the plant. It has inoi-struction The cost includes almost being budt by Niagara Mohawk Power cated that completion is war-
$300 mdhon for environmental protec- Corporation and scheduled for ranted it is possible that the PSC wdl tion f acihties including a wet completion in late 1986 Like many set financial incentives and hmestone scrubber to remove sulphur nuc! ear plants currently under con- penalties for the project owners re-d:oudn from exhaust gases At struction, the project has expen 3nced lating to final construction costs the end of 1981. expenditures of $215 a steaoy nse in estimated con- NYSEG's share of the project s cost, m'thon had been made on the plant struction Cost since its start in including allowance for funds Pubhc heannos on a radroad to used dunng construction, is $712 md-bnng coal and hmestone to the p! ant hon of which $935 mi hon was were completed in December Three spent at the end of 1981.
routes for the ranroad vary ng in length from 15 to 30 mdes. have been proposed to the U S laterstate Comme ce Commmsion Each has Construct. ion Program been opposed by vanous env,ron. 602 563 368 menta! ana f armland preservat on Completed Ten Years Forecast Three Years groups The ICC is expected to 1972-1981 1982-84 9
$1,533,000,000 decide the nsue in the spnng of $1,602,000,000 ;
1982 '
Thc Company is part:cipating w1th Mdhons of Dollars 4 51j l four other New York ut!hties in the con-l! 64 I 83 l 116 l 162 l 207 l 184 l 132 l 171 185 l 298 ]
+ i i
j r ., 3
'i [7 Mv.$h_-1 l
?
Nhenevor possible. NYSEG utilizes i ?m
' * +l ?
entsting nghts-of-way to build + evr. .F -
f 5 ?_^],h I~ p 1 * '
transmissonn tmes This is a new 115.000solt line to strengthen electnc y l
y ml? y y[ l d)t . Q{' ;
f
} y};)([Vjk.; [ ['
^
s-- _: ; ;
service in the Onoonta area Lali J a;_1}
>- s -A -
.a O' .d" i,cd+ U, ; ha se +
t <r- L qp:
M]M A=..hdL.A F<r .
72 73 74 75 76 77 78 79 80 81 82 83 84 9
A_
' (p .- ,
.j -
f.E2~ =-
g ,,
iiE~;g k,
.- m .,,1.-
.- ;o
.a .
- I+/ [ .
9 7 eg, y g - g n-- ,,, g ~ , '
.g , ,.
j [
g_$
. uasaga _
m 6,
'%E3 y
' ' J ,
u
+
_ 4 h
~
, d? i W.'- '
\.' -
L .
f QII; ):;;
3- } _x 3 .a., .
- ' ' .' :;j
- ~ . i .~'
h Eg-L s, -
. . ' 1, - 'i q:p f 4 ,. ' ag- ,g a 3 _
%[ .~;',, y .- *
- - 3 .- - .
~
.g ' , , ,q .
v : c' . : - . " . .. .. J,
- 0' + _g I'
.;,:7 ym -
~ ~
gf . ; ,
i' ? .
^l _
. ,, , . ~
.. g'... .i.[*
f [. '
6
- 'I
_ .;) j f ,. ,
Q r _....: .s
. .-+ M 3;,4'a. y.:.v..
, - -i .
.~
l
~
>:c .'.A , . g.. :
' g7 y,& .
[-[d?,p>~ h. ,,N ~;I.Mfh-[
G '+ ' ;;Y_ "i -?' > s
..t. .
- l*' ,,,.
n .,
u , '* -
,, *y ^2.g
~.
, e-* v 1 % . 4 .
. ,. . s ov 6. '* .*
' Terminated Nuclear Projects projects for general improvement of Continuation of the construction
, Rec;very of electric and gas systems, including program is contingent upon, among
' Expenditures Pending $43 million for minor projects. each other things, receipt of adequate costing $25.000 or less. electnc and gas rates. If the PSC does In 1979 and 1980 the New York State not permit higher revenues to Board on Electnc Generation Siting cover increased costs, the Company and the Er,vironment tumed down Future Construction may be unable to finance the proposals by NYSEG and Long Island Outlays Continue at entire program.
Lighting Cornpany to build jointly- Record Highs owned nuclear generating plants at New Haven in upstate New York Outlays for conctruction are planned and a' Jamesport in eastem Long to continue at high levels through Financing Island 1984 when Somerset Generating Cash Needs Amount to The Company is seeking PSC Station is expected to be comp!eted.
$374 Million approval to recover its expenditares it is es9 mated that construction on the projects throegh rates avec expenaitures in 1982 through 1984 Like construction expenditures.
a penod of years. About $60 million will aggregate $1,533 million, which financing requirements reached new includes $281 millon of allowance highs in 1981. Cash needs were
($43 million after tax effect) had been expended by NYSEG on James. for funds used during construction. $374 million which included $265 mil-port and $44 milhon ($33 milhon Somerset and its related rail facihty lion for construction, $65 million after tax effect) on New Haven Most will require $886 million. The for maturing secunties and $44 million of the outlays were for environ. Company's share of the Nine Mile for reduction in short-term debt.
mental studies and other pre-con. Point ll project is budgeted for $300 About $80 million, or 30% of struction work required by law. milhon. Other large expenditures construction expenditures, was gen-in September 1981 a PSC adminis. include $67 milhon for improvements erated internally. Sale of secunties trative law judge recommended at existing coal-fired generating provided $270 million. The remainder that recovery of the New Haven ex. facihties and $60 milhon for addit;ons of the $374 million came from a pend tures be approved A PSC to hydro-electnc generating capacity. reduction in working capital and $11 decision in the matter is expected The remainder of the three-year million received as the Company's shortly. Action on the Jamesport program is allocated for general share of a settlement of nuclear fuel apphcanon is not expected untillate reinforcement of the Company's elec- supply htigation.
1982. tnc and gas systems. Sales of secunties during the year 1981 Construction Expenditures Total Almost
$300 Million Industrial Electric Revenues Construction expenditures in 1981 were $298 milhon which includes $33 (thousands) e o al milhon of allowance for funds used Stone. clay and glass products $ 17.645 14.5 %
dunng construction Pnncipal outlays Machinery. except electncal 13.579 11.2 were $123 million for Somerset Food and kindred products 11,149 9.2 Station. $62 mdhon for the Company's Transportation equipment 10.751 88 share of Nine Mile Point 11 and $10 Electncal machinery and supplies 10.283 8.5 milhon for a hydro-electnc project Fabncated metal products 10,131 8.3 on the Hudson River at Mechanic. Pnmary metal industnes 9,954 82 ,
ville. ihe remainder was spent on Rubber and plastic products 8 253 68 l Chemicais and a!hed products 4,165 3.4 P3per and aihed products 3.443 28 Pnnting and pubbsh;ng 3.048 2.5 l Instruments and related products 3.032 2.5 l Nonmetal mining. excluding fuels 3.018 2.5 Wood products, except furniture . 2.019 1.7 Despite high mortgage rates and Leather and leather products 1.321 1.0 l generally-reduced housing activity, Textde mdl products 1.217 1.0 l construction of new dwelling units Petro: cum and retsning 1 205 .9 l continued on 1981. Residential cus- Metal m<ning 1.098 .9 tomers added during the yearincluded Furn'ture and fixtures 921 .8 4.200 for electric service and 540 for Apparel and other textue products 265 .2 gas. Most new residences use elec- Misce'laneous industnes 2.145 1.8 tricity or gas for space heating. Unclassified (under 50 kw demand) . 2.976 25 Total $121.618 100 0 %
Total e:ectnc revenues $609.178 11
. .N
- 41. . ._
i .
$ g' * ,
k f'*-
- lM I I
-} ,S q
)
g
.<.m. .
yi L o m; ,,,
m >
r 3
+
L&c
, f'y -
f *L'
. (; ~, .a.
N P8 ; 7g'
.4 e fi l f .....
r
_S.4 T gone
. , e.o y;'
, _44 .'-e-+
w
~
s a _
~ ;. .;
I'
, h_ . ; .( ~ . ..
9 jv,. .
- .._ 7 -
g.,
Jg ,'
'~
e N c. ' , ^ . *
~
y ...
18 ,- .
' ;, .'- f 3 s
.m,- p-(' c, y , hol,
. . w y$..:P 4 :1. '. .
%, .~ R , . ' ,,
- , .-}"j a_ ;j<g- '
, . , g.
'. t; ja .;a. ,L '
, x '
.,K -
l'.' ,.
.:* ,1 . ,,
- y
. , p e,,
' ' . ";. f; . '. , ;
. . ' '_ ' ' . f. . ..
?calg;. .
i - - ' -
l - . '
- .1. .
/ -- . ~ . , .
gp n;
i-'f,;
- r. ./-t , -
~..-
y $"* ..
[. .-. .l l, - . .
< y.a,.v s .
+ , ; . .. : ? . .s :.
.+. . .. .gi: .. . ?
~
L; ' . ^Z A.'j hf:-.
A 973.%,;.y'k
- i . . 9e 4
,s
- ['
- ' ~
', h* kk.]E[fll
- $ ??l
= .m,g ay . ,
a s ..
1 l
included the foUoMng (douars in Institute reCelved $2 2 mdhon. It and expenence were selected from mdhons) Conducts research for more than 600 the Company's Binghamton. Elmira electnc utikties nationwide. The and Ithaca operating areas. The w ry 5 m 14 - % tum due m!
Company contnbuted $2.4 mdhon to panel meets regularly to discuss mat-Apr . 30 15 % pmtened s'oc. Empire State Electnc Energy Re- ters which concern consumers.
Aurmt v t rum s+rs 2 500 000 search Corporabon which sponsors Each member serves a one-year term W" > research for the state's major without compensation. except for Q; ] [],[Ujj" electnc utN.e1 A. other t.870.000 was spent for the Companis share 01 ifmbursement of travel expenses.
In other efforts to assist customers n a mord erwercri p:ar
% 5 research conducted by the New Yor4 and iravove communications, the State Energy Resea'ch and Devel- Company has consumer repre-opment Auttority. sentatives in district offices who assist The common shares nsued in custcmers who have d:fficulty About $1.7 mdhor was devo'ed to Augunt were sold through under- he Company's own research waters to the pubhc at $15 50 a share pay ng Sr sarvice or related prob-efforts Among pro 1ects being studtd lems. An awartwinnino pubhcahon.
After deduction of underwnting is better Ltii ation of the !!y ast.
fc the Company received $14 94 a Senior Sun. is circulated to senior
?eit after burn.ng oi coal in generating Citizens and provides information on Y " Y in 1982 it s es0 mated that the n ar Company will reqa:re about $470 n is Wg usM & kgy conmabon coeues to penmentally as an ingredient in receue attention. Company market mdhon of external funds to finance asphalt for paving parking lots and service representatives work with construchon and pay for matunng highways. Fly a^ from another p! ant residential and business customers to secunhes About $85 mdhon was s being sold to firms which manu- identify ways of saving energy.
raised in January 1982 with pubhc facture conc ete products Almost 20.000 home energy audits sales of $50 mahon pnncipal amount have been conducted to date Customer Assistance and 3.200 loans, aggregating $5 8 01 n ro re o m.
mdhon, have been arranged to mon stock. The stock was sold to Consumer Advisory Panel Formed help customers reduce energy con-underwnters at $1418 a share and sumption. The loans can be used reoffered to the pubhc at $14 75 A Consumer Advisory Panel was to finance such improvements as new, a sham more effiClent furnaces, insulation.
formed in 1981 to strengthen com-Also in January. as part of a program to finance po!lution control munication with customers Nineteen storm windows and solar water persons with vaned backgrounds heaters facihties at Somerset Station.
the Company pubhcly sold $61 mdhon poncipal amount of tax exempt 9% o pollution control notes due January 1,1985 through the New York State Energy Research and Devel-opment Authonty The notes are The Revenue Dollar-1981 backed by a letter of credit issued by a major bank Proceeds of the sa!c. a!ong with proceeds from an m gy,,
issuance through the Authonty 2is cas
,%,g yn, of up to $35 mdhon of tacexempt * .
, o commercial paper, wdl be used s 4L_
W"'"" ,
Fuei 22c t!
l3 to finance the facihties pend:ng g g permanent financing l ]
gy p , 9, ;
nes.n,m 4sc 4 Un$s me .
Research and Development ;y T*
Variety of Projects Supported ; ,*
- y. ! ces , mmy g ,crased , sc hj More than $7 mdhon was spent on a vanety of research and deie!op-cw - as 23c 5 si .
y; 9 ~ ~ *: 4 p.,,g ,s , wc l $
,J. ((
ment projects in 1981 About three- g }{ f ., :,: k' 53 quarters of tne expenditure was for the Company's partic! pat:on in t,
~
h{ 1o.nemmenys oeveoaten and ec l 3 f. m semes o
%Q me
, q . owems-c- secx-Dwends - PWe"ed Simk 2c p _ ;___ ,gg,m ,
7c nat.onal and stato electnc research S* * ' " "*
programs Electnc Power Research - - -- - netained in the Eks4 ness 4c L 13
7 k
1
, 1 i "' -- ys i
5 P4?f[* +
y *f;+y. s 7,
, f q
.,,
- g
- ? +R %)QM
\
ty[kiE )
>c.V;c .-
- wr=su A x .
g';25.
- x M e.
y 3 . s
\ ? .
j
! on a. \
! e;y ,
i
\ Gjdf E j
\ 5' 1 fl i d
f 9.
- e
\
/ ,, r
/ 4 <( [ ,
1 iV
& qfk w -
'/
/r
'f\
5\
\
\
\
\
\ \
\ .
! \
\
tyLqiy
_, i sue == e 1
l
,. \
. < )
eg5
. / ,_ _ - 4 3
j
W
+ ~
) h
, w i \
l Suburban areas outside large cities constitute a large portion of the
<ydQ~ X." -
)' }M* 6"M y '~ , f -
service area. Shown here is part of an r ~ q' . * . '.
- 2 [k* -
.(
.-w,' '
. / l
.W award-winning condominium complex .N , .?
..%% ?)^ .
? *~ '
north cf New York City. m 4.A.
' t '
- e
?..
u .x ..
p
> $ . u,4,. ,' , ?, -
4
+4 -
t7
. ,p .,.
w o. . .
4; f ...
y
\
- g g * $g a m- g Persormel ' D % \ , .. .
':# b Vthic!e Accident '-
l Rate improves p, ' ' ,
k' . a N hd [ff~y'."
- h% t Employees drrang Company vehicles -
'E improved their accident record g4 ' $ p" 4'
! du..og 1981. The accident rate was
, N( s s ~a 4{
- ~
5 08 accider.u per million m:les j A
' dr:ven, which cornpares with 6 24 per ' T '
I, '
milliua miles in 1980. For electnc -
Utilities nallonally, the average rate !s 4 i' ~
currently 8 69 accidents per million
{_ %
gd Map f ~^ 4 % *4 miles dnven Affirmative action to hire, train 1fg *g i . '
- ,-%7 y 4p' g
and promote m:nonty-group persons %W ,; .-
4 and women continued dunng the ,
4
! p's #
k
- ~
year. Policies and procedures . 4 #
on sexual harrassment. and equal * ' '
, employment opportunities for Viet 1981. However, the effect of the addi-Nam veterans and disabled persons. Gas Operations were developed and implemented Industrial Sales Up Sharply tion on sales was offset by a 3%
Several programs were conducted to decline in average use per customer, increase the awareness of female Sales of gas increaseo 6% over 1980 which largely reflects greater employees to career opportunities largely as a result of sharply-higher customer energy conservation.
within the Company sales to industnal customers, Previously, in 1980. average use per Revenues were up 13%, reflecting customer had declined 7%.
Electric Operations pass-through to customers of higher Operating expenses rose $14 Sales Rise 2%, purchased gas costs and increased million, or 12%, primarily because of Revenues Up 20% rates. Percent changes by customer an 11% increase in purchased gas category were as fonows: cost. On a unit basis, the cost of Electnc sales in 1981 were up 2%
whde revenues increased 20% over un t sa es Revenues purchased gas was $2.82 per deka-the previous year. The revenue in- Rements > 8% therm which compares with $2.59 commercix 1 8 in 1980' crease reflects higher rates and industr1ai 16 26 fuel costs included in customer bill- Tot 3 6% 13%
ings Percent changes by customer About 1.500 residential gas space category were as follows: heating customers were added in k.m sa es Revenues Re% dent x 2% 20 %
commcw 1 m E7" 3
% S% Cost of Coal Used for Generation Average consumption by residential Cents per Million BTU
_.g,.,.,
customers and the number of 1972 m,ad 45.2 customers each increased about 1% 1973 C232 48.3 1 dunnq the year The average --re ,-
em~. ,83 residential rate was 613 cents per 1974 -_
g g g g g f> $ g . _
kilowatt-hour, which compares to 1975 u,m w.m a .ma_..;; 97.7 5 25 cents in 1980 1976 P ' ~
~ "
^l 100.2 Electne operating expenses in-1977 7":U"t.NN ---___,cj 103.7 creased $52 mdlion, or 19% A larga ,, _ _ _ . _ , _ ,
part of Ihe increase, or $41 mdhon.
was due to higher production ex-1978 1 ][], " ]TL (([j 122.6 .
l w- " - '
E
~
penses including the cost of fuel and 3979 -
- "' ~
?
~ C T^ ^. J "- -
~3131.0 M -,
purchased electncity The unit 1980 .c., _ m .. , .. u. _J 136.2 __
cost of fuel was $157 per mdhon Btu. 1981 [1 2_i.Z[.a m.i._i. _ , " d _157.0,.
a 15% increase over 1980 - - - ~ ~
15 i l
l
~
-.ma - ~
' ~' '
>Ng I
g gp, 1.
- 9' g3 .~' :- 4 6 -
k 5
f % -
s,n
. . c, ;
e I t rug ? ~~
[ .%
V. ~~l .. _
Ol' :
, '4~ '
sw. .
,, ; 7 r
g 4 q ,
- J
{ , . .
3.. 7
- i. '
/ .
%1
/ .'
\ -
e '
,,aeg; 4
/ ..
I
~
j
>n .
e' .
. ' .Q
'+~
- Q;%
- tj f;f ;4:g sh;&k + W%
ef/ SIN Okg _
s $$;.. __
M:rk:t fsr C mm:n Stock cnd R:l ted Security Holder Matters The Company's common stock is listea on the New York Stock Exchange The number of stockholders of record at January 20.1982 was 71,464.
Price of Common Stock New York Stock Exchange Composite Dividends Paid 1981 1980 Per Share High Low High Low 1981 1980 Firtt quarter $16 $13% $17 $13% $ 47 $ 44 Secord quarter 16 14 17 % 14 % .47 .44 Third quarter 16 % 14 17 % 15 % .50 .47 Foucth quarter 15 % 14 16% 13 % .50 .47 Dividend Lim:tations: After dividends on aLI outstanding preferred stock have been paid, or declared and funds set apart for their payment, the common stock is er, titled to cash dividends as may be declared by the Board of Directors out of retained earnings accumulated since December 31,1946. Such dividends are limited if Common Stock Equity (39% at December 31,1981) falls below 25% of total capitahzation. Dividends on common stock cannot be paid unless all sinking fund requirements of the preferred stock are met. The Company has not been restricted in the payment of dividends on common stock by these provisions.
~"~'"~"'""'"
Coo 3ers
&Ly3 rand To the Stockholders and Board of Directors New York State Electric & Gas Corporation Ithaca, New York 4
We have examined the balance sheets of New York State E%ctric & Gas Corporation as of December 31,1981 and 1980 and the related statements of income, retained earnings and changes in financial position for each of the three years in the period ended Decem-ber 31,1981. Our examinations were made in accordance with generally accepted audit-ing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances.
In our opinion, the financial statements referred to above present fairly the financial position of New York State Electric & Gas Corporation at December 31,1981 and 1980 and the results of its operations and the changes in its financial position for each of the three years in the period ended December 31, 1981, in conformity with generally accepted accounting principles applied on a consistent basis.
b Pfr %@ h k b New York, New York January 29,1982 17
New Y;rk Stat) Electric & Ga3 C rporation R:lznc3 Sheet D c.mber si 1981 1980 ASSETS (Thousands of Dollars)
UTILITY PLANT, at original cost (Note 1)
Electnc . . 31.550.985 $1.469 836 Gas , . 129.493 124.850 Common , , 47.539 45.762 1,728.017 1,640.448 Less accumulated depreciation
,90.579 452.464 Net utility plant in service 1.237,438 1,187,984 i Construction work in progress (No'es 8-10) 663.695 476.793 ,
1.901.133 1.664.777 OTHER INVESTMENTS (Note 3) . 20.0 5 21.261 CURRENT ASSETS Cash 7.210 6,921 Special depos ts 6.197 11,128 Accounts receivable 80,415 71,187 Fuel. at average cost ,
31,517 29.836 Matenals and supphes. at average cost 26.148 24.583 Prepayments 12.079 10.712 163.566 154.367 DEFERRED CHARGES Fuel costs deferred (Note 1) 21.886 19.146 Other 21.668 12.430 43.554 31,576
$2.128.298 $1.871.981 CAPITALIZATION AND LIABILITIES CAPITAllZATION (Notes 4-7)
Capital stock and retained earnings Preferred stock redeemable solely at the option of the Company 5 115.500 $ 115.500 Preferred stock subject to mandatory redemption requirements 120.575 71.313 Common stock equity Common stock . . . .
217,499 194.732 Capitalin excess of par value . . 234.746 208.629 Reta:nec1 earnings 270.464 238.856 Total common stock equity 722.709 642.217 .
Long-term debt 813.398 777.819 Total 1.772.182 1.606.849 CURRENT LIABILITIES Secunties to be redeemed or due within one year . 60.737 64,737 Notes payable-commercial paper (Note 7) 35.000 6.800 Accounts payable , , 79.556 56,098 Dividends payable on preferred stock 4.896 3.582 Pensions accrued 13.300 13.100 Taxes accrued 16,570 16.787 Interest accrued 20.960 17,850 Other 29.822 20.517 260.841 199.471 DEFERRED CREDITS Accumutated deferred investment tax credit (Note 2) 33 695 29 621 Other 5.251 2.016 38.946 31.637 ACCUMULATED DEFERRED FEDERAL INCOME TAX (Note 2) 56.329 34,024 COMMITMENTS AND CONTINGENCIES (Notes 8 and 9) - -
$2.128.298 $ 1.871.981 The accompanying notes shown on pages 21 through 28 are an integral part of the financial statements.
18
! New York State Electric Q G:a Corporation l
i Stat:m:nt cf incSme Years Ended December 31 1981 1980 1979 (Thousands of Dollars)
OPERATING REVENUES Electnc $609.178 $506,502 $477.643 Gas 158.361 '38.812 110.568 Total 767.539 645.314 536 211 OPERATING EXPENSES ,
Operat;on- fuel (Note 1) . 177.592 151.404 142.141
-other 103,294 96 877 83.226 '
Electocity purchased and inte c!.,nged 7.029 (2.030) 2.626 G3s purchased *12.176 100.895 74.542 M.entenance 51.616 44.121 40f69 Depreciation 49.448 47.433 43.807 Federalincome tas (Note 2) . 43 844 N.382 27,163 Other taxes (Nate 11) 72.935 63.552 t'3.362 Total 622.934 530.687 477.436 OPERATING INCOME 144,605 114.627 110.775 OTHER INCOME AND DEDUCTIONS Allowance for other funds used dunng construction (Notes 1 and 8) 21.922 21.029 17,486 Federal income tax credit (Note 2) 9.471 10.496 9.815 Other-net (234) (266) 93 INCOME BEFORE INTEREST CHARGES 175.764 145.886 138.169 INTERrST CHARGES Interest on long term debt 68.773 61.217 55.347 Other interest 9.987 6.361 3.289 Allowance for borrowed funds used dunng construction (Notes 1 and 8) (10.797) (9 896) (7.856)
I Interest charges-net 67.963 57.682 50,780 NET INCOME . 107.801 88.204 87.389 PREFERRED STOCK DIVIDENDS 17.536 14.567 14.117 EARNINGS AVAILABLE FOR COMMON STOCK . $ 90 265 $ 73.637 $ 73.272 EARNINGS PER SHARE $2.95 $2.70 $2.83 AVERAGE NUMBER OF SHARES OUTSTANDING 30 566,063 27,311.154 25.886.419 St:t; ment of Retained Earnings Years Ended December 31 1981 1980 1979 (Thousands of Dollars)
Ba!ance. beginning of Year 3238.856 $214.310 $185.479 Add net income 107.801 88.204 87.389 346 657 302.514 272.868 Deduct cash div'dends Preferred stock (at serial rates)
Redeemable solely at the option of the Company 7.710 7.710 7,710 Subject to mandatory redemption requirements 9.826 6,857 6.407 Common stoc6 ($194. $182 and $1.72 per share in 1981.1980 and 1979. respectively) 58 657 49.091 44.441 76.193 63,658 58.558 Balance, end of year $270.464 $238 856 $214.310 The accompanymg notes shown on pages 21 through 28 are an integral part of the t'nancial statements.
19
New York State E!actric & Gas Corporation
~
Statement cf Ch:nge]in Finan;ill Picitirrl ~
Years Ended Decembe'r 31 [~
1981 1980 '1979 SOURCE OF FUNDS (Thousands of Dollars) :
Net inccrr.e $1C7.801 $ 88.204 ' $ 87.389 l I
Depreciation 49.448 47 486 43.807 Amortization of deferred charges 6.146 3 302 1.713 Federal income tax deferred -ne! -21,122 12.822 (298)
Investment tax credit deferred-net 4.074 7.813 11.048 Altowance for funds used during cwstruction (37.719) (30.925) (25.342)
Funos from opera!!ons , 155,872 # 7 28,702 118.317 Proceeds from sale of fi st mortgage bonds 160.000 -- 50,000 Proceeds from sate of common s'ock ~ 50.639 .
48 416 7.243 Proceeds from sale of preferred stock 60 000 -
20.000 increase (decrease) in commercial paper .,,. 28.200 (18.700) (9.800)
Proceeds from contract settlement agreement 11.271 - -
Decrease (increase) in working capital
- 23.971 46.532 (6.439)
Proceeds from sale and leaseba9 of seroce centers s_ 9.300 -
Total funds ava' fable $489 92.3 $214.250 $179.321 APPLICATION OF FUNDS Additions to utility plant $265.545 $154,516 $145.928 Dividends on preferred stock 17.536 14,567 14,117 f Dividends on common stock 58.657 49.091 44.441 Secunties to be redeemed or due within one year 60.737 64.737 17.244 Fuel costs deferred 7,316 2.583 3.600 Bonds reacquired for sinking fund -
3 603 -
Decrease (increase) in notes payable 72.500 (74.500) (44.215)
Other-net 7.632 (347) (1.794)
Total funds apphed $489.923 $214.250 $179.321 INCREASE (DECREASE)IN WORKING CAPITAL CURRENT ASSETS Cash $ 289 $ 1.336 $ 1.035 Special deposits (4.931) (402) 615 Accounts rece!vable 9.228 7.630 9.951 Fuel 1,681 (3.478) 14,407 Matenals and supphes 1.565 3.759 4.552 Prepayments 1.367 901 1.009 Total increase in current assets 9.199 9.746 31.569 CURRENT LIABILITIES Secunties to be redeemed or due within one year (4.000) 47.493 7.156 Accounts payable .
23 458 11.585 9.762 Dividends payable on preferred stock 1.314 (102) a12 Taxes accrued (217) (4.504) 4.040 Interest and pensions accrued 3.310 1,215 1.123 Other 9.305 591 2.637 Total increase in current liabihties* 33.170 56.278, 25.130 Increase (decrease) in working capita l* $ (23 971) $ (46.532) $ 6,439
- Exclusive of changes in commercial paper The accompanying notes shown on pages 21 through 28 are an integral part of the financial statements.
20
l nit:3 tD Fin nci:1 St:tzm:nts l
- 1. Significant Accounting Policies determined on January 1 of each year. The Company's policy is to fund pension costs accrued.
- c. Accounting records The Company maintains its accounting records in 1981 1980 1979 conformity with the uniform system of accounts pre-(Thousands of Dollars) scnbed by the Federal Energy Regulatory Commission Provision for (FERC) and the Public Service Commission of the pension cost . $ 13,300 $ 13,100 $ 12,600 State of New York (PSC). Actuarial present
- b. Utility plant value of accumu-Cost of current repairs and minor replacements is lated plan benefits:
charged to appropriate operating expense and clearing Vested 83,600 72,600 62.900 accounts, cost of renewa!s and betterments, in. Non-vested . 13,100 14,100 12,700 cluding indirect costs, is capitalized Original cost of Net assets avai!able utility plant retired or otherwise disposed of and the for benefits 159.000 128,100 104,000 cost of removalless salvage are charged to accumulated f. Deferred fuel charges depreciation The Company defers certain fuel and purchased gas
- c. All:;wance for funds used during costs which are subsequently billed to customers c nstruction (AFDC) through adjustment clauses in rates.
AFDC, a non-cash item, is shown on the Statement g. Depreciation of locome as AFDC-other funds and AFDC-borrowed The annual provision for denreciation is determined using funds. AFDC is defined in the regulatory system of straight-line rates, based o'n average service lives, accounts as the net cost, for the period of construction- applied to tW original cost, by groups of depreciable of borrnwed funds used for construction purposes property in service. Depreciation accruals were and a reasonable rate on other funds when so used. equivalent to 3.2% of average depreciable property for (See Note 8 ) 1979 through 1981.
The Company capitalized AFDC on a compound basis, net of taxes, a' rates of 7.5%,8% and 8.7% for 1979,1980 and 1981, respectively. The Company is allowed revenues equal to the federal income tax ef-fect of the interest on debt portion of AFDC. 2. Federal income Taxes AFDC was not recorded on construction work in prog- For federal income tax purposes the Company uses the ress (CWIP) a' lowed in rate base which amounted sum-of-the-years digits depreciation method, the to (1) $30 million for the first five months of 1979, (2) Asset Depreciation Range System (ADR) and effectbe
$31.4 minion for August 1980 through June 1981, January 1,1981, for property additions subsequent (3) $275 million for July 1981 through October 1981 and to 1980 it adopted the Accelerated Cost Recovery Sys-(4) $200 million for the last two months of 1981. tem (ACRS) pursuant to the Economic Recovery Tax Act of 1981.
Reve es rom the sa!e of electncity and gas are 8, s em tax ce@s W basd on e hNe Act of 1973 %) were dected cwdy recorded on the basis of meters read in income and were shared equally between stock-
- c. R;tirement plans holders and customers for rate-making purposes. The The Company has noncontnbutor/ retirement annuity additional 6% ITC derived from the Tax Reduction Act plans which cover all officers and substantially all of 1975 are deferred. The Company has approximately employees. Annuity plan costs are based on normal $14,565,000 of unused ITC at December 31,1981.
costs and amortization of the unfunded liability. The The PSC, in its October 1981 rate decision, required assumed rate of return used in determining actuanal that the ACRS reductions in taxes and all ITC (10%) ;
present values of accumulated plan benefits was 6%, claimed on ACRS property subsequent to the rate order, i and benefit information in the following table was be deferred. The PSC previously required that federal j income tax reductions arising from the use of ADR be similarly deferred. These benefits are to be returned to income over the book life of the applicable property.
1 1
21
, . . - - . -. - _~ --- - _ - - -
n 9; . -. .
, ,l' in the klyM080 ra'e cecision, thq PSC allowed Federal income tax provisions for 1979 through 1981 revenues equal to the federal ir ooma m effect of pension are substantially less than the arriount obtained by costs, insurance cos'.s and ah taxe(ch'arged to CWIP using the statutory rate due to the following:
for electric facihties on1 9 gffectra %}h the PSC's October 1981 1980 1979 1981 rate decieron, the ao fational revernues will be limited to Ine federa. irioMe tax effect applicable Statutory rate ... . 46.0 % 46.0% , 46 0 %
to pension and isedisnce costs !0 excess of $6 milhon. Decrease: %
which represcds captalized costs applicable to Excess of allowable tax ,j. . , i minor projects. Th'siederahncome tax tnnefit is recorded . depreciation and t as a reduction of CWIP.
~
amortization overbocS , i _,? .
s
(,5 7) 'e (6.3)
Federal income taes for 1979 throbgh 1981 are as amounts .. . .. . . ' ( 4.71, follo.wb,e ' .".. ' Costs capitalized on/ , '.'/ ;,
r"
, M81 ~41980 1979 ,
books,expensedtor I F .J.. (10.6) (13.4) (11.1)
Charged to Taxes, pensions and ,
operations. R8)
$ G,650 $ (2,600)* $ 6,580 insurance . . . . , 07) (10)
Current . ..-
et . 21,122 12,822 - (298) s.
a d ts . .).. .
(2.0) (3.4) (49) sceHaneous m . . p 9) p6) (2.3)
' income tax '
behefit 7,485 6.203 Actualrate . . . 24.2 % 16 9 % 16.6 %
6.83 ' %
Investment .
tax credu j 3. Other investments Deferred .
n 7,944 8,835 11,764 The Company has entered into jong term contracts for Shared . ,1,292 1.840 2,914 the supply of coal to the Homer City Generating Station, od in that connection, has agreed to make loans
, d.844 28.382 -27.163 (maximum aggregate amount of $23.150,000 approved included iri c'her ~ y
~
s
,p by the PSC) to the mining companies. These loans ircome:- a
~
($16.575,000 and 48,275,000 at December 31,1981 AFDC imputed .-
s and 1980, respectively) were made on first mortgage income tar , -e notes maturing December 31,1982 which currently benefit ' , ., , (6,836) f7,485)- (6,203) bear interest at,one-half percent above prima. The
,!nves,trTient tax Company intends to seek PSC permission to extend the
. credits -shared 1 1,292) M,840) (2,9.3) matunty date of these notes. The Company sold to Amertization of ,
Chemical Bank 100% participations in these notes which ITC deterred in have been recorded as long-term notes payable due pnor years . -
(1,204) .(1,022) (717) April 5,1986. The agreement with Chemica! Bank Tax on other ,
requires the_ Company to repurchase the participatio'ns -
incor% . (139) (149) 19 unoer certain conditions. _
(10,496) The Company has establishec a wholly owned sub-(9.471) (9.815) sM, N Someyset Railroad Corporation (SRC), to Total' ~$34'373 $17,896 $14348 construct rail facihtles to the Somerset Generating
- This credit amount was due principally to the tax Station, in addition to its investment of $200.000, the loss related to the abandonment of nuclear projevs Company has guaranteed SRC borrowings of $5 milhon ~
proposed for New Haven and Jamesport (see Nota 8). under a bank line of credit.
~
', T: ,
i
- r N j i
e, P
- y. . 1 e
[ [ '
6
't i ,/
i i ,
s,.. ,
g
,,# s Sj- , .
2 -
.. ( ./
- a w
2a , 1 , r n' Y , s / s y
l
- 4. Lcng t rm Debt (Thousands of Dollars)
First mortgage bonos Senes Due Amount Senes Due Amount t o 60% Oct 1,1982 5 50.000 8%% June 1.1996 $ 50.000 3 %% Ma/ 1.1984 20 000 5%% Jan 1.1997 25.000 3 %% Sept 1,1985 15.000 6%% Sept 1.1997 25.000 12 %%" Dec 1.1986 50.000 6%% Sept 1.1998 30.000 4%% May 1. !987 25.000 7%% Nov 1.2001 50.000 3%% Feb 1.1988 25.000 9 35% July 1,2003 50.000 17 %%* Mar i.1989 50.000 9 % Mar 1.2005 75.000 17 %%* Mar 1.1990 50.000 9%% Jan 1.2006 71,397 14 %W Jan 1.1991 60.000 7%% June 1. 2006 12,000 4%% May 1.1991 25.000 6 %% Dec 1.2006 25.750 8%% Nov 1.2007 60.000 Total first mortgage bonds . $844.147 Notes payab'e to banks due January 31.1985 (Note 7) . 2.000 Participations in m:ning compan:es' notes (Note 3) . 16.575 Unamorti/ed premium on debt 676 863.398 Less debt due within one yearwr.cluded in Current habihties 50.000 Total $813.398
- lssued 1981 " Issued 1979 In 1982 the Company issued $G1 mdhon of 9%% unsecured three-year notes in connection with a tax-exempt f nancing and $50 mukon pnnc, pal amount of first mortgage bonos,18% senes. due 2012. At December 31.1981 long-term debt (erclusive of notes payable to banks) whicn will become due dunng the following five calendar years is:
1982 1983 1984 1985 1986 (Thousands of Dollars)
$50.000 $2.397 $25.100 $20.100 $71.675 The Company's mortgage provides for a sinking and improvement fund The provisions require the Company to make annual cash deposits with the Trustee equivaient to 1% of the principal amount of all bonds delivered and authenticated by the Trustee prior to January 1 of that year (excluding any bonds issued on the basis of the retirement of bonds) Pursuant to the terms of the mortgage. the Company has satisfied these requirements by crediting ~bondab'e value of property additions" against the amount of cash to be deposited.
Mandatory annual cash sinking fund requirements are $3.000.000 for the 9%% senes due 2006. $2.100.000 beginning July 1.1984 for the 9 35% senes. $600.000 beg;nning June 1,2001 for the 7%% senes and $250.000 beginning December 1.1992 for the 6%% senes The amount increases to $500.000 and $750.000 on December 1.
1997 ano December 1. 2002. respectaely. for the 6%% senes The mortgage indenture secures the first mortgage bonds which constitute a direct first mortgage lien on substantra!!y a!! utikty plant
- 5. Cnmmon Stock and Capital in Excess of Par Value At December 31,1981 common stock and capital in excess of par value were as follows Amount Shares (Thousands Outstancing of Dollars)
Common stock. par value $6 66'A a share. 60.000.000 shares authonZcd (shares issued 2.500.000 in 1981 and in 1980 and 1.949.819 through the Dividend Reinvestment and Stock Purchase Plan since January 1.1979) 32.624.755 $217.499 Cap;tal in excess of par value increased $26.117.000 $27.766.000 and
$4.102.000 in 1981.1980 and 1979. respectively. resulting from sa!es of the Company's common stock at amounts in excess of par va!ue $234.746 In February 1982 the Company sold 2.500.000 shares of common stock 23
- 6. Preferred Stock At December 31,1981 serial cumulative preferred stock was composed of the following:
Par Shares Value AenudO) Amount l Redeemable Pe and (Thousands Senes Share Pnor to Per Snare Outstanding of Dollars)
Redeemable so!ely at the option of the Company.
3 75 % $100 S104 00 150.000 $ 15.000 4 % %(1949) 100 103.75 40,000 4.000 4 15% 100 101.00 40.000 4.000 4 40% 100 102 00 75.000 7,500 4.15 %(1954) 100 102.00 50.000 5.000 648% 100 2/1,83 103 00 1 300.000 30.000 Therea'fer 102 00 1 8 80% 100 3'1/86 106.14 3/1,91 103 94 250.000 25.000 Thereafter iO2.00 8 48% 25 2/1/84 27.29 '
f Thereafter 2
25 70.
- 1,000.000 25.000 Total $115.500 Subject to mandatory redemption requirements (2) 4 50 % 100 (3) 105 25 6.125 $ 612 8 25% " 100 1/1 83(2) 109 00 200.000 20.000 900% 100 10/1/82(4) 106 50 267,000 26.700 15 %%* 100 4 '1 < 86(5) 115.38 300,000 30.000 8 50 % 25 7/1,82(6) 25 00 360.000 9.000 9.10 % 25 7/1.84(7) 28 75 600.000 15,000 15 %* 25 1/1/87(8) 28.75 1,200,000 30.000 131,312 Less sinking fund requirements at par value-included in current liabihties 10.737 Total $120,575
" Issued 1981 " Issued 1979 At December 31,1981 redeemable preferred stock sinking fund requirements for the following five calendar years are:
1982 1983 1984 1985 1986 (Thousands of Dollars)
$10.740 $1,740 $1.740 $24.740 $4,740 (1) At December 31,1981 there were 1,250.000 shares of $100 par va!ue preferred stock, 3.600.000 shares of $25 par value p:eferred stock and 1,000,000 shares of $100 par value preference stock authorized but unissued.
(2) Each of the following series of preferred stock is not redeemable prior to the date designated, through certain refunding operations. but otherwise is redeernable at the indicated price per share prior to the indicatad date.
The indicated pnce per share will be reduced either (A) annually or (B) at five-year intervals by the reduction amount As of the redemption at par date and thereafter, the redemption price will be at par. By the redemption date, the Company must set aside the amount required to redeem at par a!I shares outstanding.
Date Indicated Indicated Reduction Redemption Redemption Senes Designated Price Date Amount at Par Date 8 25% 1/1,85 $109 00( A) 1/1 < 83 $1.00 1/1,85 3'28 85 9 00 % 10/1/86 106 50(A) 10'1/82 .50 10'1/94 9 30 ~96 15 %% 4!1,86 115 38 4th86 110 00(B) 4/1 91 5 00 4/1,96 4/1/06 9 10% 7/1:84 28 75 7/1.84 25 65(A) 7/1,85 .16 7/1/88 7/1/89 15 % 1/1,87 28.75(B) 1/1/87 1,25 1/1/97 1/1/11 24
I l
l(3) By March 31, in each year 1982 through 1988, the Company must redeem at $103.25 per share 875 shares of the 4 50% Senes. Since 1979,875 shares have been reacquired and canceled annually.
(4) By September 30, in each year 1982 through 1995, the Company must redeem at par 16,500 shares of the 9 00% Series Since 1980,16.500 shares have been reacquired and canceled annually.
(5) By Apnl 1, in each year 1987 through 2006. the Company must redeem at par 15,000 shares of the 15%% Series.
-(6) By July 1,1982 the Company must redeem at par 360,000 shares of the 8.50% Series. Since 1980,120,000 shares have been reacquired and canceled annually.
(7) By July 1, in each year 1985 through 1989, the Company must redeem at par 120.000 shares of the 9.10%
Senes.
(8) By January 1, in each year 1987 through 2011, the Company must redeem at par 48,000 shares of the 15%
Senes.
- 7. Crnk Loans and Other Borrowings The Company has revolving credit agreements with banks (see Note 4) which provide for borrowing, at prime, up to
$100 million through January 31,1985 and payment of annual commitment fees of approximately three-eighths percent on the unborrowed amount. The loan agreements do not require compensating balances, but balances generally have averaged ten percent o' the available line of credit during 1981. A substantial portion of these balances represents normal working account funds Interim financing in the form of short-term borrowings on commer-cial paper is utilized to finance construction expenditures The Company also has agreements with three banks which provide for borrowing, at pnme, up to $30 million through November 30,1982.
Information relative to short-term borrowings is as follows:
Commercial Paper Notes Payable 1981 1980 1979 1981 (Thousands of Dollars)
Ending balance , $35,000 S 6,800 $25,500 5 -
Maximum amount outstanding $99,100 $73,500 $72,000 $60,000 Average amount outstanding (1) . 540.600 $42,500 $22,500 $10,400 Weighted average interest rate.
On ending balance . 13.4 % 17.5% 13.5% -%
During the period (2) 16.5 % 12 8 % 11.6 % 17.0 %
(1) Calculated as the average of the sum of daily borrowings.
(2) Calculated by dividing total interest expense by the average of the sum of daily borrowings.
- 8. Ab:ndoned Projects-New Haven and Jamesport The Company and Long Island Lighting Company have been denied certain regulatory approvals to construct, on a joint venture basis, nuclear generating facihties near New Haven, N.Y. and Jamesport, N.Y. The New York State Board on Electric Genera' ion Siting and the Environment (Siting Board) granted the companies a Certificate of Environ-mental Compatibility and Public Need (Certificate) for one 800,000-kw coal fired generating unit near Jamesport.
The Company has notified the Siting Board that it will not accept the Certi;cate f and that it has decided to terminate its participation in the Jamesport project.
The Company has filed petitions with the PSC requesting authorization to (1) continue to accumulate AFDC on its share of costs until amortization of such costs commences to be recovered in rates, (2) amortize the investments through rates and (3) include in rates appropriate carrying charges on the snaaortized balances. The Company is planning to file applications with the FERC requesting authorization to continue to accumulate AFDC in the same manner as requested in the petitions to the PSC.
PSC proceedings are continuing in connection with the New Haven petition. The PSC has authorized the Company to continue to accrue and accumulate AFDC on the nuclear related costs of the Jamesport project until a decision is made with respect to the prudence and disposition of the nuclear costs. If the requests to the PSC or to the FERC .
to continue to accumulate AFDC are denied, the Company may have to reverse certain accruals of AFDC previously l recorded. If the request to amortize the investments is denied and alternative regulatory relief is not granted, the Company would have to charge income with the project costs, net of the federal income tax effect.
The Company's net income for 1981 includes $4 million of AFDC attnbutable to the New Haven project and 55 million of AFDC attributable to the Jamesport project. As of December 31,1981, the Company had expended, including AFDC, approximately $44 million for the New Haven project and $60 million for the Jamesport project. The Company expects to incur additional expenditures in connection with the cancellation of the Jamesport nuclear units.
- 9. C mmitments The Company est! mates that 1982 costs for the construction program will approximate $602 milhon. The program l is subject to penodic review and revision, and actual construction costs to be incurred may vary because of revised i load estimates, imposition of additional regulatory requirements and the availabihty and cost of capital. (See Note 10.) l l
l l
25 j
- 10. Jointly Owned Generating St ti:na The Company has an undivided 50% interest in the output and costs of three generating units comprising the Homer City Generating Station The station is owned with Pennsylvania Electnc Company which also operates the facihty. The Company's share of the rated capabihty is 944,000-kw and its net utshty plant investment is $274 milhon, which includes $30 mdhon of CWIP The accumulated provision for depreciation as of December 31,1981 was
$55 mdhon. The Company's share of operation and maintenance expense of the station is reflected in the Statement of Income.
The Company also has an undivided 18% interest in the 1.084,000-kw Nine Mde Point nuclear generating unit No 2 (Unit) being constructed by Niagara Mohawk Power Corporation (Niagara Mohawk) near Oswego, N.Y. In early 1980 the co-tenants having an interest in the Unit (Co-tenants) engaged independent engineering and management consulting firms to perform a review of the Unit's estimated cost and scheduled in-service date, together with engineering, construction and management systems Also, a reassessment was conducted by Niagara Mohawk and Stone & Webster, the architect engineer and construction agent. As a result of those reviews, a $2.4 billion revised cost, exclusive of AFDC and nuclear fuel, and a rescheduling of the operation date from 1984 to late 1986 were announced in September 1980. The Company's share of the construction cost, including AFDC. is now estimated at $712 mdhon. The Company's investment of $235 mdlion. excluding nuclear fuel costs, is included in CWIP at December 31,1981 During 1980 the PSC directed Theodore Barry and Associates and Canatom Limited to perform a comprehensive management audit covenng essentially the samo areas as the review commissioned by the Co-tenants, and a report thereon (TB&A Report) was issued in July 1981. The TB&A Report stated that the planned 1986 completion date is possible, but that a hkely one-year shppage in schedule, new regulatory requirements, higher escalation and AFDC could significantly increase the Unit's cost.
In July 1981, vanous parties petitioned the PSC to estabhsh a pubhc evidentiary proceeding to consider the future of the Unit In September 1981, the PSC Staff issued a report on a comparative analysis of the economic and
- financial feasibdity of the Unit and coal alternatives which concluded that completion or the Unit is warranted. In September 1981, the PSC estabhshed a proceeding to inquire into the financial and cost implications of completing the Unit. Heanngs were completed in December.
Event subsequent to the date of the auditors' opinion At a February 9,1982 meeting the PSC stated its consensus that completion of the Unit is warranted and that no basis exists at this time to take further action regarding abandonment of the Unit. The PSC also concurred with the PSC Staff recommendation that the Co-tenants must emphasize their attention to the control of the Unit's cost and the con-struction schedule to minimize the impact on ratepayers and indicated its intention to monitor closely all construction activities in addition, the PSC decided to explore the feasibikty of instituting a yet undefined incentive program that could cause the return on the equity portion of the investment in the Unit to vary depending on a variety of items related to the Unit's ultimate cost and completion date. A formal PSC decision is expected upon completion of its re-view of the feasibihty of instituting an incentive program. The Company is unable to predict what recommendations or actions may arise as a result of this review or what further actions, if any, may be brought by the intervening parties.
- 11. Supplementary income Statement Information
! Charges for maintenance, repairs and depreciation. Other than those set forth in the Statement of income, were not s'gnificant in amount Taxes, other than payroll and federal income taxes, are classified as follows:
1981 1980 1979 (Thousands of Dollars)
Real estate and personal property . $33,640 $29,622 $26.773 Franchise and gross receipts 33,575 28,652 31,633 Miscellaneous 4.556 3.690 3.098 TotaLcharged pnncipally to tax expense . $71,771 $61.964 561,504 26
- 12. Industry Segment informatlin l Certain information pertaining to the electnc and gas operations of the Company is as follows:
1981 1980 1979 Electnc Gas Electric Gas Electric Gas (Thousands of Dollars)
Operating-Revenues $ 609,178 5158.361 5 506,502 5138.812 $ 477,643 $110,568 Expenses 472.848 150.086 397,605 133,082 373.735 103,701 Income 136,330 8.275 108.897 5,730 103,908 6.867 Depreciation
- 45.654 3,794 44,133 3,353 40,679 3,128 Construction expenditures 259.065 6.480 146.589 7,927 141,580 4,348 identifiable assets ** 1,894,367 106 165 1.654,492 103.302 1,532,984 97,538
- Included in operating expenses
" Corporate assets ($127,766, $114,187 and $107,001 at December 31,1981,1980 and 1979, respectively) consist pnmarily of cash special deposits, accounts receivable, prepayments and unarmortized debt expense.
- 13. Qu:rterly Financial Information (Unaudited)
The following is a summary of quarterly results of Company operations as previously reported to stockholows:
Quarter Ended March 31 June 30 Sept. 30 Dec.31 (Thousands) 1981 Operating revenues $220.705 S173,281 $168.365 S205.188 Operating income . S 36,832 5 28.498 5 35,628 5 43.647 Net income S 30.110 $ 22,661 5 22.532 S 32,498 Earnings available for common stock . S 26.528 $ 18.273 $ 17,862 S 27.602 Earnings per share (in dollars) . S.90 S 62 S.58 S.85 Average shares outstanding . 29,323 29.558 30.920 32.505 1980 Operating revenues S192,070 S149.122 $135,180 $168,942 Operating income . S 32.933 $ 26.602 S 28.047- S 27,046 Net income 5 26,434 S 19,790 5 22,39J $ 19,590 Earnings available for common stock S 22,751 S 16.107 5 18,771 $ 16,008 Earnings per share (in dollars) _ $ 87 $ 61 5 68 S.55 Average shares outstanding . 26.185 26,314 27,613 29.109
- 14. Supplementary Information to Disclose the Effects of Changing Prices (Unaudited)
The following presentation is intended to show certain information about the impact of inflation on the Company's financial operations. The information was developed using assumptions and estimates and therefore should not be viewed as precise indications of the effects of inflation.
Constant dollar amounts represent historical costs stated in terms of dollars of equai purchasing power, as measured by the Consumer Price Index for all Urban Consumers (CPI-U). Current cost amounts reflect the changes in specific pnces of utihty plant from the date the plant was acquired to the present. The current cost of utility plant represents the estimated cost of replacing existing utihty plant assets and was determined primanly by indexing existing plant by the Handy-Whitman Index of Public Utihty Construction Costs. The provisions for depreciation on the constant dollar and current cost amounts of utihty plant were determined by applying the Company's depreciation rates to the indexed plant amounts.
Under the rate-making processes to which the Company is subject. only the historical cost of utility plant is recoverabte in revenues. Therefore the excess of the cost of utility plant stated in terms of constant dollars or current cost over the histoncal cost of plant is not presently recoverable in rates as depreciation and is reflected as a reduction to net recoverable value. While the rate-making process gives no recognition to the cost of replacing utihty plant, based on past practices the Company believes it will be al lowed to earn on the increased cost of its net investment when replaced.
To properly ref!ect the economics of rate regulation, the reduction of utihty plant to net recoverable value should be offset by the purchasing power gain on net amounts owed The gain from the deci ne in purchasing power of net amounts owed is pnmanly attnbutable to the substantial amount of debt which has been used to finance util:ty plant Since the depreciation on this plant is hmited to the recovery of historical costs, the Company does not have the opportunity to reahze a holding gain on debt and is limited to recovery of only the embedded cost of debt capital.
27
1 Income from Continuing Operations Adjusted for Changing Prices Average 1981 Dollars l
Constant Current Dollar Cost l
(Thousands-exceptpershare data) :
Income from continuing operations, as reported . $107,801 $ 107,801 Adjustment to restate depreciation expense . (58.138) (69.530) income from continuing operations . . .. . .
$ 49,663* $ 38.271 '
income from continuing operations per common share (after preferred stock dividends) . . .. . . .. $1.05* 5.68 tr. crease in specific prices of utility plant held during the year" $ 291,494 Le ,s increase in general price level . . . . .. .. 266.320
$ 25.174
). Net change . . . ..
Reduction of utility plant to net recoverable value . . $ (96.778) $(110.560) !
9
- Atter the reduction of utility plant to net recoverable va;ue, income from continuing operations on a constant dollar
^
basis would change to a loss of $47.115 or $2.11 per average common share.
"At December 31,1981, current cost of net utility plant was $3.300,210, while net recoverable value at historical cost was $1,901,133.
J Five-Year Summary of Selected Financial Data Adjusted for Changing Prices 1981 1980* 1979* 1978 1977 (Thousands-except per share data)
Operating revenues j As reported . .. $767,539 S 645,314 $ 588.211 $532,171 $459,452 In 1981 purchasing power $767.539 $ 712.251 $ 737.022 $741,880 $689,558 Income from continuing operations As reported $107,801 5 88.204 S 87,389 $ 70,563 $ 59.945 i Constant dollar basis" $ 49,663 $ 44,810 S 62,742 Current cost basis . .
$ 38,271 S 32,111 $ 44,798
- Income from continuing operations per common share (after preferred stock
, dividends) i As reported $2.95 $2.70 $2.83 $2.46 $2.21 Constant dollar basis" $1.05 $1.05 $1.74 "*
j Current cost basis . . S.68 S.58 $1.05 Net assets at year-end at net ,
! recoverab!e value As reported ..
$838,209 $ 757,717 S 684,863 $648,906 $558,450 Constant dollar and current cost $809.674 $ 836,313 $ 858,126 j
l Reduction of utility plant to net recoverable value "* *"
Constant dollar basis . $ 96,778 $ 154,662 $ 182,210 Current cost basis $110.560 S -
$ 39.449 Net change in value of utility plant *" "*
held during the year . .
$ 25,174 $(171,793) S(124,817)
Purchasing power gain on "* *"
j net amounts owed .. $ 85.602 S 114,534 $ 126,645 Cash dividends per common share
. As reported ., $1.94 $1.82 S1.72 S1.68 S1.60 i in 1981 purchasing power $1.94 52.01 $2.16 $2.34 52.40 ,
j
~
Market price per common share ,
at year-end i As reported .. . ... .. $15.00 $14 88 $15.75 $16.88 $19.13
- In 1981 purchasing power $15 00 $16.42 S19.73 $23.53 $28.71 Average CPI-U . 272.4 246 8 217.4 195.4 181.5
'All constant doliar and current cost data for 1979 and 1980 have been restated to average 1981 dollars.
" Excludes the reduction of utility plant to net recoverable value.
'"The Financial Accounting Standards Board does not require the calculation of inflation-adjusted data for years prior to 1979, nor is the data readily available.
4 28
Selected Financial Data 1981 1980 1979 1978 1977 (Thousands-except per share data)
Operating revenues S 767,539 5 645.314 5 588.211 5 532,171 5 459,452 Net income $ 107,801 5 88.204 $ 87,389 5 70,563 $ 59,945 Earnings per share $2.95 52.70 $2.83 $2.46 $2.21 Dreidends paid per share $194 S1 82 51.72 $1.68 51.60 Average shares outstand:ng 30,586 27,311 25.886 23,393 21,208 Interest charges S 78.760 5 67,578 5 58,636 5 57,639 5 49,129 AFDC-other aad borrowed funds $ 32,719 5 30,925 $ 25.342 5 16.655 $ 25,363 Depreciation S 49.448 5 47,486 5 43,807 5 41,462 $ 34,544 Other taxes S 72,935 5 63,552 5 63.362 5 57,064 5 50,645 Utihty plant additions 5 265,545 S 154.516 $ 145,928 5 143.229 $ 158,493 Total assets S2.128.298 51,871,981 $1,737,523 51,603,425 51,489,862 Lon0-term obhgations and redeemable preferred stock 5 933.973 5 849,132 5 844,214 5 772,134 5 733,336 1
M:ncgement's Discussion and Analysis of Fin:ncial Condition and Results of Operations The Company is constructing a wholly owned 625.000-kw and associated rail f acihties and $307 million, including coal fired generating unit (Somerset Generating Sta- nuclear fuel, for the Unit. The construction program tion) and associated rai! f acihties near Somerset, N.Y., is under continuing review and is revised from time to time scheduled for service in late 1984. The current estimate in hght of the Company's financial condition, load for the cost of the plant is $1,072 n,'llion, of which forecasts, the availabihty and cost of capital, licensing approximately $352 milhon will be spent in 1982. The decisions, regulatory requirements. inflation and Company also has an undivided 18% interest in the other factors 1,084,000-kw Nine Mile Point nuclear generating unit The Company anticipates that to finance its Construc-No 2 (Unit) being constructed by Niagara Mohawk Power tion program through 1984, approximately 70% of Corporation near Oswego, N Y The Company's share the funas required will be raised through the issuance of the Construction cost including allowance for funds of secunties. The nature, amounts and timing of used during constructic 7 (AFDC), is estimated at future financings will depena in part on the level of con-5712 milhon and its investment of $235 milhon, excluding struction. load growth, the timehness and adequacy nuclear fuel costs, is included in construction work in of fate rehef, the availab,hty and cost of capitai and the progress (CWIP) at December 31,1981. (See Note 10 ) continuing abihty of the Company to meet its property The Company's construction program, including additions and interest coverage requirements under AFDC, is currenty estimated to cost $602 milhon. S563 its Mortgage and preferred stock dividend coverage mi! bon and $368 million for the years 1982,1983 and requirements in its Certificate of Incorporation 1984, respectively Included in the three-year program is A $115,610,000 increase in the cost of fuel for electric
$886 milhon for the Somerset Generating Station generation, power purchased and interchanged and 29
in the cost of gas purchased, which was recovered 22.2% increase, and $8,800,000 in added gas revenues, through the fuel and gas adjustment clauses, and a a 5% increase. The electric increase includes $45
$96.806,000 increase in electric and gas rates accounted million allowed on a temporary basis in June. The higher for 90% of the Company's $235,368,000 increase revenues are approximately 87% of the amounts in operating revenues over the past three years The originally requested and are designed to produce a 17%
balance is chiefly attnbutable to kilowatt-hour safes, return on common equity. The increases became which increased 5%, and unit sales of gas, which effective on October 25,1981 and allowed the inclusion !
- increased 2%. of S200 million of CWIP in rate base.
j During the same period operating expenses increased On February 18, 1982, the Company applied for in-
, $193,725,000, or 31%, principa!!y as a result of in- creased electric and gas rates. The requested increases .
} creases in (a) fuel and natural gas purchased costs in annual electric and gas revenues are $148,928.000 ,
($107,488,000), (b) wages, materials and supplies used and $4.924,000, respectively, based on a projected in operations ($46,916,000) and (c) federal income test year ending December 31,1983, the inclusion in l taxes ($27,494.000). rate base of $450 million of CWIP and the recovery over
! Increased AFDC rates and higher levels of CWIP a ten-year period of the expenditures related to the resulted in a $16,064,000 increase in AFDC during the terminated New Haven and Jamesport projects. The three-year period. Interest charges before the reduction requested increases are designed to produce a 17.5%
for AFDC-borrowed funds increased 37% ($21,121,000) return on common equity. The PSC is not expected due to increased borrowings at higher interest rates to reach a final decision on this rate application until i to finance the Company's construction program. January 1983. The Company has no assurance that
! Eamings available for interest charges provided 2.48 such higher rates will be granted.
- times the interest on the Company's first mortgage The Company's funds requirements were provided bonds for 1981. This calculation is based on the provi- by the following sources
sion stated in the Company's Mortgage and compares with 2.69 in 1980 and 2.54 in 1979. The Mortgage contains a requirement, subject to certain exceptions, 1981 1980 1979 that first mortgage bonds may be issued only if net (Thousands of Dollars) earnings, as defined, are at least 2.0 times the annual Operations $155,872 $128,702 $118.317 '
interest charges on bonds outstanding and to be Secunties sales outstanding. Eamings available for interest charges and Bonds 160,000 - -50,000 :
4 preferred stock d9idends provided 1.70 times the Preferred stock 60,000 - 20,000 ;
interest and dividends on preferred stock in 1981. Th.is Common stock -50,609 48,416 - 7.243 :
j calculation is based on the provision stated in thn Notes payable Company s Certificate of incorporation and compares to Bank loans - 74,500 44,215
- 1,72 and 1.85 for 1980 and 1979, respectively. The Commercialpaper 28.200 - -
Certificate of Incorporation contains a requirement that Contract settlement i preferred stock may be issued only if net earnings, agreement 11,271 - -
i as defined, are at least 1.5 times the annual interest Sale and leaseback charges on all outstanding indebtedness plus the annual of service centers -
9.300 -
dividend requirements on preferred stock outstanding $465 052 $260.918 $239,775 and to be outstanding. These coverages will vary in future years depending on decisions in rate cases and on the need for extemal funds to finance the Company's construction program.
Earnings available for common stock were in 1982 the Company will be required to raise external
$90,265,000, or $2.95 per share in 1981, compared with funds of approximately $470 million. This external
$73,637,000, or $2.70 in 1980 and $73,272,000, or funds requirement is needed for the construction program '.
j $2.83 in 1979. Average shares outstanding were and to supply the $60,737,000 needed for refunding 30,586.063 in 1981,27,311,154 in 1980 and 25,886,419 and sinking fund requirements on first mortgage bonds
' i n 1979. Return on average common equity was and preferred stock. In 1982 the Company issued 13 4% in 1981,12.3% in 1980 and 13.4% in 1979. The $61 million of 9%% unsecured three-year notes H con-1 increase in 1981 earnings was principally due to rate nection with a tax-exempt financing, $50 million increases received in June and October. principal amount of first mortgage bonds,18% series due
. On October 20,1981, the Public Service Commission 2012 and 2.500,000 shares of common stock.
of the State of New York (PSC) issued a rate decision Management has provided supplementary information approving $124,500.000 in added electric revenues, a to disclose the effects of changing prices in Note 14.
q 30
l Fin:ncial and Opercting Statistics
SUMMARY
OF EARNINGS 1981 1980 1979 1978 1977 1976 1971 OPERATING REVENUES (Dollarsin Thousands)
Electnc $609,178 $506.502 $477.643 $433,774 $374,456 $330.870 $176.574 Gas 158,361 138.812 110.568 98.397 84.996 77.397 44.488 Total 767.539 645.314 588.211 532,171 459.452 408.267 221.062 OPERATING EXPENSES Operation-. fuel 177,592 151,404 142.141 118.384 87,181 72.621 32,205
--other 108.294 96.877 83 226 74.465 67.544 60,132 32.574 Electncity purchased and interchanged 7.029 (2.030) 2.626 19.059 46.599 33.679 15,293 Gas purcha:>ed 112,176 100.895 74.542 63.896 56.284 47,944 26.455 Maintenance 51.616 44.121 40,569 38.529 33.709 29,757 17,294 Depreciation 49.448 47.486 43.807 41,462 34.544 32.589 24.118 Federal income tax 43.844 28.382 27.163 16.350 330 7.751 1.825 Other taxes 72.935 63.552 63.362 57.064 50.645 44.296 25.608 Total - 622.934 530.687 477.436 429.209 376.836 328.769 175.372 OPERATING INCOME 144.605 114.627 110.775 102.962 82.616 79,498 45,690
' OTHER INCOME AND DEDUCTIONS Allowance for other funds used during construction 21,922 21.029 17.486 10.659 14.056 7.803 975 Federal income tax credit 9.471 10.496 9.815 8.383 1,255 1,166 -
Other. net (234) (266) 93 202 (160) (158) 109 INCOME BEFORE INTEREST CHARGES 175.764 145.886 138.169 122.206 97.767 88.309 46.774 INTEREST CHARGES fnterest on long term debt 68,773 61.217 55,347 52,337 45,119 39,712 20,877 Other interest 9 987 6.361 3.289 5.302 4.010 2.673 653 Allowance for borrowed funds used during construction (10.797) (9.896) (7.856) (5.996) (11.307) (5.961) (796)
Interest charges-net 67.963 57.682 50,780 51.643 37.822 36.424 20.734 NET INCOME . . 107.801 88.204 87,389 70.563 59.945 51,885 26.040 PREFERRED STOCK DIVIDENDS 17.536 14.567 14.117 13.090 13.094 10.465 5.205 EARNINGS AVAILABLE FOR COMMON STOCK . . . 90.265 73.637 73.272 57,473 46.851 41.420 20.835 COMMON STOCK DIVIDENDS 58.657 49.091 44.441 38.732 33.564 28.375 17.145 RETAINED EARN!NGS $ 31,608 $ 24,546 $ 28.81 $ 18.741 $ 13.287 $ 13.045 5 3.690 Average number of shares of common stock outstand.ng (thousands) 30.586 27.311 25.886 23,393 21,208 18.181 12,365 Earnings per average share . $2.95 $2.70 $2 83 $2.46 $2.21 $2.28 $1.68 Dividends paid per share $1.94 $1.82 $1.72 $1.68 $1.60 $1.60 $1.39 31
Fin'ancial Statistics I
1981 1980 1979 1978 1977 1976 1971 INCOME STATISTICS: (Dollars in Thousands)
Return on average common stock equity-percent . 13.4 12.3 13.4 11.8 10.9 11.4 9.2 Mortgage bond interest
-times earned , 2.8 26 2.6 2.5 2.5 2.4 2.6 Interest charges and preferred dividends
-times earned . 1.9 1.9 20 1.8 1.8 1.8 1.8 Average common stock equity per share $22.01 $21.92 $21,17 $20.82 $20.17 $19 96 $18.33 PROPERTY PLANT AND EOU!PMENT:
Electnc $2.209.278 $1.942.378 $1,787.229 $1.659.928 $1.520.410 $1.353.604 $795,049 Gas 133.156 127.456 120.760 117.168 114.076 111.062 94,567 Giner 49.278 47.407 40.910 40.584 38.597 36.743 20.818 Total $2.391.712 $2.117.241 $1.948.899 $1.817.680 ' $1.673.083 $1,501.409 $910.434 ACCUMULATED DEPRECIATION $ 490.579 $ 452.46t $ 411.742 $ 376.933 $ 350.014 5 324.852 $217.597 CAPITALIZATION.
Long-term debt $ 863.398 $ 837.819 $ 780.671 $ 721.347 $ 677,961 $ 595.026 $394,792 Preferred stock . 246.812 191.550 196.287 176.375 176.463 176.543 91.957 Common stock equity 722.709 642.217 569.363 533.406 442.950 393.184 227.446 Total capitalization . $1.832.919 $1.671,586 $1.546.321 $1.431.128 $1.297.374, $1.164.753 $714.195 CAPITALIZATION RATIOS (percent):
Long-term debt 47.1 50.1 50 5 50 4 52.3 51.1 55 3 Preferred stock . 13.5 11.5 12.7 12.3 13.6 15.1 12.9 Common stock equity 39 4 38.4 36.8 37.3 34.1 33.8 31.8 NOTES PAYABLE:
Bank !oans $ 2.000 $ 74.500 $ -
$ 21.000 $ 15.000 $ -
Commercial paper . 35.000 6.800 25.500 35.300 59.500 40.500 4,000 Total $ 37.000 $ 81.300 $ 25.500 $ 35.300 $ 80.500 $ 55.500 $ 4.000 NUMBER OF STOCKHOLDERS:
Common stock 71.464 70.737 67,014 64.579 51.580 45.146 25.033 Preferred stock . 5.932 6.083 6.308 6.503 6.544 6.591 3.605 PAYROLL (including pensions e.tc):
Charged to operations $ 83.044 $ 73.442 $ 66.611 $ 58.186 $ 55.639 $ 51.175 $ 28.594 Charged to construction and other accounts 44.504 43.046 41.664 40.179 37.518 34.419 18.176 Total $ 127.548 $ 116.488 $ 108.275 $ 98.365 $ 93.157 $ 85.594 5 46.770 Number of employees end of year 4.307 4.310 4.200 4.215 4,202 4,170 3.785 32
, -. . - . - - . - . . . - - ~ -
Electric Sales Statistics 1981 1980 1979 1978 1977 1976 1971 Kwh Sales (milhons):
Residential . 4.429 4.325 4.329 4.297 4.203 4.093 3.125 Commercial 2.516 2.485 2.455 2.438 2.370 2.322 1.700 Industnal 2,845 2.769 2.843 2.632 2.515 2.369 2,045 Pubhc authonties 1.218 1.163 1.152 1.125 1.123 1.112 881 Other electnc utikt:es 8 16 10 23 27 26 1.296 Total . 11.016 10.758 10.789 10.515 10.238 9.922 9.047 Operating Revenues (thousands):
Residential $271,335 $226.867 $215.504 $197,024 $168.041 $151.790 $ 80.350 Commercial 142.643 119.545 111.292 103.192 89.899 79.857 35.536 Industnal 121.618 98.976 94.013 81.332 70.009 58.095 24.705 Pubhc authonties 64.113 53.139 49 802 45.679 40.776 35.808 17.141 Other electnc utihties 301 467 301 438 447 414 15.809 Other operating revenues 9.168 7.508 6.731 6.109 5.284 4.906 3 033 Total operatf g revenues $609.178 $506.502 $477.643 $433.774 $374.456 $330.870 $176.574 Operating Revenues per kwh (cents):
Residential . 6.13 5 25 4.98 4 59 4 00 3.71 2.57 Commercial 5 67 4.81 4.53 4 23 3.79 3 44 2.09 Industnal 4 27 3.57 3 21 3 09 2.78 2.45 1.21 Pubhc authonties 5 26 4.57 4- 4.06 3 63 3.22 1.95 Other electnc utihties 3.76 2.92 3 01 1.90 1.66 1.59 1.22 Average revenue per kwh . 5 53 4.71 4.43 4.13 3 66 3 33 1.95 L
Number of Customers (average for year): '
Residential . 599.117 593.321 586.665 578.982 571.701 564.502 513.187 Commercial 58.164 57.174 56.568 55.725 55,113 54,808 51.192 Industnal 1.348 1.319 1.290 1.298 1.284 1.279 1,217 Other 9 684 9.554 9.396 9.226 9.042 8.633 7.577 Total 668.313 661.368 653.919 645.231 637.140 629.222 573.173 Annual Average Use (kwh):
Residential 7.393 7.289 7.379 7.422 7.352 7.252 6.089 Commercial . 43.257 43.464 43.399 43.751 43.003 42,366 33.208 Industnal(thousands) 2.111 2,099 2.204 2,028 1 959 1.852 1.680 Annual Average Bill:
Residential . $ 453 $ 382 $ 367 $ 340 $ 294 $ 269 $ 157 Commercial 2.452 2.091 1.967 1.852 1.631 1.457 694 Industrial 90.221 75.039 72.878 62.659 54.524 45.422 20.300 33
(
Electric Operating Statistics 1981 1980 1979 1978 1977 1976 1971 PRODUCTION DATA:
System Capability (megawatts):
Net generating capability:
Steam 1.720 1.745 1,734 1,728 1.527 1.377 1.354
- Hydro 38 38 38 38 38 38 38
'! Internal combustion 11 11 14 14 14 14 14 Total .. 1.769 1.794 1,786 1.780 1.579 1,429 1,406 '
Purchased-Power Authonty 764 774 680 712 824 848 541
-Other 242 250 200 100 100 200 -
Total system capability 2.818 2.666 2.592 2,503 2.477 1,947
_ 2.775 Annual Load Factor (percent) 64 4 67.1 65 2 63.6 62.9 61.0 63.8 Coal Bumed (thousands of net tons) , . .. 4.867 4.724 4.748 4,430 3.720 3.395 3.214 Coal Heat Value (Btu per Ib.) 11.600 11.537 11.378 11.141 11.056 11,123 11,353 Btu per Kwh Generated (net) . 10,701 10.639 10.582 10.744 11.145 11.112 10.879 Kwh Production-net (millions):
Generated 10.762 10.449 10.430 9.350 7,606 7,046 6.920 Purchased , 2.419 3.127 2.765 3.282 3.509 4.383 3,101 Interchanged (923) (1.408) (1.082) (909) 201 (298) (47) [
Total 12.258 12.168 12.113 11,723 11,316 11.131 9.974 Production Expenses (thousands)
Generated $216.805 $185.109 $171.079 $148.285 $110,448 $ 91,724 $ 45.034 Purchased 47,140 47.202 35.757 37.297 39.670 34.926 15.486 Interchanged (net) (40.111) (49.231) (33.131) (18.238) 6.929 . (1.247) (193)
Total , , $223.834 $183.170 $173.705 $167.344 $157.047 $125.403 $ 60.327 Production Costs per Kwh (mills):
Generated . 20.15 17.72 16 40 15.86 14.52 13.02 6.51 Purchased 19 49 15.09 12.93 11.36 11.30 7.97 4.99
, Totalincl. interchan0e . 18 26 15.05 14 34 14.27 13 88 11.27 6.05 ELECTRIC OPERATION AND MAINTENANCE EXPENSES (thousands):
Production $223.834 $183.170 $173.705 $167,344 $157.047 $125,403 $ 60.327 Transmission . 11.308 9.930 8,616 8.171 7,612 7,058 4.356 Distnbution 32.287 30.455 27.306 22.644 22,544 21,569 11.712 Customer accounting 13.449 11.379 10.467 9.467 8.527 7.672 4.293 Customer service 3.719 3.669 3,137 2.887 2.605 2,507 1.820 Administrative and general 40,129 34.423 29,664 25,537 22.972 20.068 8.398 Totaf . $324.726 $273,026 $252.895 $236.050 $221,307 $184.277 $ 90.906 j
i i
34
e l
Gac Department Statistics 1981 1980 1979 1978 1977 1976 1971 Ockatherm (dth) Sa'es (thousands);
Residential , , 16.412 16,482 17.312 18,386 18,373 19.958 20,781 Commercial . 8.044 7,937 8.150 8,654 8,408 9.484 9 600 Industnal . 11,509 9,883 9,336 8.651 7,968 9.243 12,270 Other , 3.991 3.356 3.600 3.638 3.132 3.808 3.420 Total . 39.956 37.658 38.398 39.329 37,881 42,493 46,071 Operating Revenues (thousands)
Residential , $ 71,399 5 66.333 $ 54,196 $ 50.642 $ 44.895 $ 40,387 $ 23,637 Commercial 30.989 28,698 22.894 20.908 18.236 16,850 9.256 Industnal 40.077 31,730 23,461 18.252 15.205 13,668 8,495 Other 15.896 12.051 10.017 8,595 6.660 6.492 3 100 Total operating revenues $158,361 $138.812 $110,568 5 98.397 $ 84,996 $ 77,397 $ 44.488 Operating Revenues per dth.
Residential . $ 4.35 $ 4.02 $ 3.13 $ 2.75 $ 2.44 $ 2 02 $ 1.14
. Commercial 3.85 3 62 2.81 2.42 2.17 1.78 .96 Industnal 3.48 3 21 2.51 2.11 1.91 1.48 .69 Other . 3.98 3.59 2.78 2.36 2.13 1.70 .91 Average revenue per dth $ 3.96 $ 3 69 $ 2.88 $ 2.50 $ 2.24 $ 1.82 $ .97 Number of Customers (average for year):
Residential with house heating 102,386 99.969 98.044 97,469 97,082 97,496 92,021 Residential without house heating . 9.910 11,117 11.917 12.124 12,630 12.812 15,737 Commercial with space heating 13,540 12,909 12,714 12,752 12.809 12.985 13,146 Commercial without space heating 1,080 1,108 1,198 1,233 1.234 1,266 1,379-Industrial 395 383 365 371 380 384 417 Other 1,144, 1.174 1.163 1,185 1,241 1.142 1.130 Total 128.455 126.660 125.401 125.134 125.376 126 085 123.830 Annual Average Use (dth):
Residential . 146 148 157 168 167 181 193 Commercial 550 566 586 619 599 665 661 Industrial 29,137 25.804 25.578 23.321 20.968 24.070 29.424 Annual Average Bill:
Residential $ 636 5 597 $ 493 $ 462 $ 409 $ 366 $ 219 Commercial 2,120 2,047 1,646 1,495 1.300 1,182 637 Industrial 101,461 82,846 64.277 49.197 . 40.013 35.594 20.366 Cost of Natural Gas Purchased.
Amount (thousande) $112,176 $100,895 $ 74.542 $ 63.896 $ 56.284 $ 47,944 $ 26.455 Per dth 2.82 2.59 1.94 1.62 1.50 1.11 .58 Gas Operation and Maintenance Expenses (thousands):
Production $112.410 $101,174 $ 74.804 $ 64,089 $ 56.923 $ 48.210 $ 26.490 Transmission and distnbution 8.249 7,608 7.177 6.775 6.469 5.939 3.018 Customer accounting 2,975 2.589 2,158 1.988 1,812 1,705 1,024 Customer service 871 749 646 479 480 321 179 Administrative and general . 7,476 6.121 5.424 4.952 4.326 3.681 2.205 Total $131.981 $118,241 $ 90.209 $ 78.283 $ 70.010 $ 59.856 $ 32.91G 35
DirectorJ Officera Charlos F Kennedy Binghamton Executive Offices
- v. , .,r~e. ano cvet r w.*" 4500 Vestal Parkway East, Binghamton, N.Y.13902 o" o . a se cwwi Wells P. Allen, Jr. Tel. 607/729-2551 r,es.o n po cneton v no o" cer u t. con v e <
Charles F. Kennedy Bernard M. Rider Roy S Arranda'e C"d 'an "4 V 'e P'eS de"'
tw ero 9 ne,, y < e p.es nera H E u cu ve co' co- E ec!l car Eng neer og Rese.vrn ana f r pw er no Wells P. Allen. Jr. "'"""9 in.m e nass v ,saus no e es oect ano Jack H. Roskoz co I m'a N 'e Cr M op w ng O"cer V ce P*es.oe< t Ahson P Casarett Dolores r1 Huc E"" OP""'"5 R: chard Kroboth Michael J. Turkovic co nca unwers 'y naca N Y V ce Pres cent
.r- m W Cra < w Everett A G:Imour "
E. Eugene Forrest c%an ano n esaem y, Wilham P. Walker ite Ne w a-B3nk y,,, m p.es ,
, yce P es dent ano Tv.! Con pry d r.m h Porscinne 4 m Nv Robert B MacKenzie Michael J. Ray Howard W Gunlocke s o,ee e es o, n: ounn w- Q 'JQ y g'l,3, ,, Ass s' ant V.ce P*es dem e%ect Fe,q neer ng ano cha , cm es < James A Ackerman cons: act on w irano N v v < e p es.oen.
"'"^""'"'""*" Vincent W. Rider Legare R Hole Ass sir! V ce Pres: dent P,esarn c m.n o an % re co"-t n Francis X. Carney come ons ano Gene x nn A#om N y vce P es#m se+c es Alexander Horwitz ""'(" " " * " " " " ' " Lynn L. Sweetland o reco ,A wan mmw 4 Ortn W Darrach Ass stam v ce P es cem o nea, ,, Ny v ce P es ent ircas , a oe.o opret William A Lyons C " "'S"""
- A so Ass s' ant sec*e'ry u., nan u - t .n u . < ANen E Kintigh
,a t oa u e can a ve V te P es ceo Uf tr e C#p#i 2e"t V LD Alton G. Marshall Raymond A Perine Stockholder Records: Communications Peoen! A *en G V ce Pres qen regard:ng stock transfer requirement $
exs,a Auc xe inc 033 opma uns or lost certificates should be d<rected ic
' " ^ ' " * '*
the transfer agent Changes of address David R. Newcomb may be sent to the Secretary. Inquines N Noyoconun, Ithaca Executive Ottices on div:dends and d:vidend reinvestment n ew N y Route 13, Dryden Road, Ithaca, N.Y.14850 should be d rected to Shareholder Ser-C Waham Stuart Tel. 607i347-4131 vrces a rw crinry ueesexo c t* ', .v toc Nooa4 Ny L. Theodore Everett John D. Scott Charles A Windinc
^" s' m V ' ~ P'es *nt The Company files an annual report o-ce.,r a sx an
'Y"e
"""* P'" ce"' "*'
on Form 10-K with the Securities and w,pm,us on .a N y Eugene P. Waters Richard P. Fagan Exchange Commission. Stockholders sen o< v ce P es een, Ass s a,e cemptv e-ano T easo.e, may obtain a free copy of this report Directors Emeritus .Jc from the Secretary upon request.
Jaime S. Hecht ss Neosh-Sheldon H. Close sec e xy James M Niefer A"o,cey Omwta N Y Securities Listed on the New York Richard A. Jacobson Ass sur! secre a",
c mp:- +, St ek Exchange:
Edgar W. Couper e e,mer c%ro e New ve.+ Richard W. Page mse soxo et nog,- s Ass s ant v ce P os de"t Common Stock a rynam - Nv cccrum sevc.es 3 75% Preferred Stock 8 80% Preferred Stock 8 48% Preferred Stock ($25 Par Value)
General Counsel: 15% Preferred Stock ($25 Par Value)
Huber Lawrence & Abeu 10 60% First Mortgage Bonds due 1982 99 Park Avenue. New York. N Y 10016 7%% First Mortgage Bonds due 2001 9%% First Mortgage Bonds due 2005 Transfer Agent for Preferred Stock: 9W% First Mortgage Bonds due 2006 Chemical Bank 8%% First Mortgage Bonds due 2007 55 Water Street. New York. N Y.10041 Transfer Agent for Common Stock:
Manufacturers Hanover Trust Company 4 New York Plaza New York N Y 10015 36
Service Area The service territory covers 17,000 square miles, has a population of 1,800,000 and is largely suburban and rural in nature. It in-cludes 13 relatively-small cities, the largest of which is Binghamton with a population of 56,000.
Among major customers are 20 .
r
,Q.
colleges and universities.
Industry is well-diversified with high-technology firms predominat- #g# 4.Qf PLATTSBURGHe.
ing. Economic growth has g generally paralleled that of the {fj g nation. ft 5 p(#gyY q
Somerset ,
LAKE ONTARIO t (under construction) AL _
=
LOCKPORT l') '"E S T E R 9A SF
@ [
) tt Q " ' ,7 W BUFFALG p*MNCASTER LAKE ERIE o~
~ {e;sp GENE UBURN 14 g . h"b~MECHANICVILLE[
J? ALBANY /$
s 2 ,m/j
? .
O f
{ _
- p y o w;; 3 a ;i.%,
HORNR_LLe:~ ~
- LEERTY To HOMER CITY ,,/
,= 3 z
+p BREWSTliRe 8 Jeg %t, E LoNGISLAND
/
y NEW YORK CITY e DISTRICT OFFICES l
b Electnc W* w ** .c;;f Gas Major Generating Stations All coal-fired
! C Electric & Gas (Kilowatts)
- 1. Homer City 921,000
' ~#'
- 2. Millikea 305.000
- 3. Greenidge 203,000
- 4. Goudey 129,000
- 5. Hickling 87.000
- 6. Jennison 75,000 Total 1,720,000 Homer City Generating Station, located on western Pennsylvania, is jointly-owned with Pennsylvania Electric Company. It provides a little over half of NYSEG's generating capacity.
37
w l
> Mz
@ 30 a mE m
w m ,N O ,
o 97 8
= -$
o @5 O Z CD 3
B o@
I '" '
2 5
o$
x9
's d a O
@ b a (o @ -
o 8g I m - .s ,, h, a
C w :n' g ' 5 syL--
~
3 O '*ii ~.
g 3O {/*-l+(-% g(( - '
u, 5 y U""N y e O
A + s. ,
O 3 C
k e
d ..w.
m O
a
\ \
.g .;
C m ,-
mZ- M W O
oog @4 o C i3 E < Hm A ooO F 5goK>2 O
o09m>
e H
m
" $ $- T D
D
_ . _ . _ . . . . . . . . . . .